US stocks pull back as European optimism fades
December 13th, 2011 - 8:57 am ICT by IANSNew York, Dec 13 (IANS) US stocks pulled back across the board Monday as initial enthusiasm about last week’s EU compact faded, Xinhua reported.
The Dow Jones industrial average dropped 162.87 points, or 1.34 percent, to 12,021.39. The Standard & Poor’s 500 fell 18.72 points, or 1.49 percent, to 1,236.47. The Nasdaq Composite Index lost 34. 59 points, or 1.31 percent, to 2,612.26.
The decline came after Friday’s rally as 17 eurozone members plus up to nine non-eurozone EU states basically agreed to join the compact based on “inter-governmental treaties” to take unprecedented measures to oversee national economies, with sanctions for governments that run up high deficits.
Under the deal, nations will make a constitutional commitment to balanced budgets with a structural deficit of less than 0.5 percent of gross domestic product. Meanwhile, the leaders also agreed to bring forward by a year the creation of the 500 billion euro European Stability Mechanism so it should be ready by July 2012.
What’s more, the leaders agreed to increase the resources of the International Monetary Fund by 200 billion euro in bilateral loans to ensure it has enough resources to intervene again in the euro crisis if needed.
However, the euphoria faded after a weekend and investor began to worry the compact was far from enough to curb the region’s debt crisis, especially after rating agencies warned that the summit did nothing to ease the pressure on the eurozone sovereign debt.
- Europe agrees to 1 trillion euro fund for new bailout plan - Oct 27, 2011
- Eurozone to lend 150 bn euros to IMF - Dec 20, 2011
- `Sweden not bound to eurozone despite joining EU pact' - Feb 01, 2012
- US stocks moderately higher ahead of earnings - Jan 10, 2012
- US stocks slide on Europe concerns - Dec 29, 2011
- Wall Street edges higher ahead of new season (Lead) - Jan 10, 2012
- US stocks close mixed - Mar 31, 2012
- Ratings agencies wary of EU summit impact on debt - Dec 13, 2011
- Eurozone approves new Greek bailout plan (Lead) - Feb 21, 2012
- US stocks fall amid Greece uncertainties (Lead) - Feb 11, 2012
- Mass strikes hit Greece as bailout talks reach climax - May 01, 2010
- Sensex sheds nearly 4 percent on weak domestic, global cues (Weekly market review) - Dec 10, 2011
- Spain's borrowing costs rise sharply in bond auction - May 18, 2012
- German budget deficit in 2011 lower than expected - Jan 13, 2012
- German industrial output shrinks - Feb 08, 2012
Tags: balanced budgets, bilateral loans, debt crisis, dow jones, dow jones industrial, dow jones industrial average, euphoria, european stability, fades, gross domestic product, initial enthusiasm, international monetary fund, nasdaq composite index, national economies, new york dec, optimism, s 500, sanctions, sovereign debt, xinhua