By Anora Mahmudova and Sara Sjolin, MarketWatch
U.S. stocks ended Monday's choppy session slightly lower as
global equities came under pressure after Greece on Sunday rejected
its international lenders' bailout terms and moved closer to a
potential exit from the eurozone.
The main indexes fell sharply at the open, but trimmed losses
during the day to end modestly lower.
The S&P 500 closed down 7.98 points, or 0.4% to 2,068.79,
with nine of its 10 main sectors finishing lower. Energy sector
stocks sold off after an 8% plunge in oil prices.
The Dow Jones Industrial Average 46.13 points, or 0.3%, to
17,683.98, with 24 of its 30 components closing lower. The Nasdaq
Composite ended the day down 17.27 points, or 0.3%, at
4,991.97.
The declines tracked losses on the European stock markets
(http://www.marketwatch.com/story/european-stocks-knocked-down-as-greek-voters-say-no-to-creditors-demands-2015-07-06),
where the Stoxx Europe 600 index fell 1.2% to 378.68 and Germany's
DAX 30 index tumbled 1.5% to 10,890. Asian shares also mostly
slumped
(http://www.marketwatch.com/story/china-shares-rise-after-beijings-weekend-rescue-2015-07-05).
Greek debt crisis: Latest news
(http://www.marketwatch.com/story/greek-debt-crisis-latest-news-2015-06-29)
JJ Kinahan, chief strategist at TD Ameritrade, noted that the
Greece story is far from over.
"I believe people are realizing that it's in everybody's best
interest to keep Greece in the eurozone. But the referendum forces
financial discipline on someone," Kinahan said.
"We expect volatility to stay higher than usual, however, as
there are still lots of uncertainties besides Greece, namely Puerto
Rico's debt problems and earnings for the second quarter," he
added.
Greece's rejection of austerity: The global selloff came after
more than 61% of Greeks voted "no"
(http://www.marketwatch.com/story/in-rebuke-to-europe-greeks-vote-resounding-no-to-bailout-terms-2015-07-05)
in Sunday's referendum on austerity measures put forward by the
International Monetary Fund and the eurozone as terms for further
bailout aid. The Alexis Tsipras-led government will now try to
renegotiate a new bailout package with the lenders, but economists
fear the lenders are unwilling to accept looser reforms, raising
concerns that Greece will exit the euro.
"The outcome of the Greek referendum has significantly increased
the risk of Greece leaving the eurozone, which is now by far the
most likely outcome," said Erik Nielsen, global chief economist at
UniCredit, in a note. "The process may start within days or weeks,
but it won't be a smooth ride into a new currency. It'll be chaos
with political ramifications."
Christine Lagarde, the International Monetary Fund chief, said
the agency stands ready to assist Greece. The IMF is one of
Greece's three creditors, and the country missed a payment to it at
the end of last month.
The euro was hit hard by the developments
(http://www.marketwatch.com/story/euro-falls-against-rivals-as-greek-voters-reject-austerity-demands-2015-07-06)
in Greece, changing hands at $1.1055, down from $1.1115 late Friday
in New York. The shared currency traded as low as $1.0952 earlier
Monday, according to FactSet.
Greece's stock market and the Athex Composite remained closed
after being shut last week. The country's banks also stayed closed.
The Global X FTSE Greece 20 ETF (GREK) traded, however, and tumbled
7.5%.
Company news: Shares of Aetna Inc. (AET) skidded 6.4% after the
health insurer on Friday said it would buy Humana Inc
(http://www.marketwatch.com/story/aetna-to-buy-humana-in-37-billion-merger-deal-2015-07-03).(HUM)
for $37 billion, after weeks of merger talks. Humana shares rose
0.7%.
Oil companies were among hardest hit. National Oilwell Vacro Inc
(NOV) fell 5%, Transocean Ltd (RIG) fell 4.3%.
For more on today's notable movers read Movers & Shakers
column
(http://www.marketwatch.com/story/a-schulman-dollar-tree-tesla-shares-in-focus-2015-07-06).
Other markets:Crude oil
(http://www.marketwatch.com/story/oil-tumbles-4-after-greek-voters-reject-creditors-reform-proposal-2015-07-06)
plunged 7.7% to settle at $52.53 a barrel, its lowest level in
nearly three months. Gold futures
(http://www.marketwatch.com/story/gold-little-changed-as-fed-trumps-greek-drama-2015-07-06)
marked first gain in four session, up 0.8% to $1.173.20 an
ounce.
Treasuries rallied
(http://www.marketwatch.com/story/treasurys-rally-after-greeks-reject-bailout-proposal-2015-07-06),
sending the yield on the 10-year note down 11 basis points to
2.28%, the lowest levels since June 19.
The dollar traded slightly higher against other major
currencies, with the ICE dollar index up 0.1% at 96.22.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires