Thursday, June 28 15:09:03
U.S. stocks fell in early trading on Thursday as investors were sceptical that the latest European Union summit would agree on concrete measures to tackle the region's debt crisis.
Financial shares led declines, with JPMorgan losing ground on a report that recent trading losses could reach $9 billion and Barclays stock down 12 percent in the aftermath of a probe into the manipulation of interbank lending rates.
EU leaders go into a meeting on Thursday more openly divided than at any time since the euro crisis began, with Germany's Chancellor Angela Merkel showing no sign of relenting in her refusal to back other countries' debts.
A spokesman for German Finance Minister Wolfgang Schaeuble said that a report that Germany could be willing to move sooner than expected to accept shared liability of euro zone debt was not true. Spanish benchmark 10-year yields hovered near the 7 percent level that recently forced other highly indebted countries to seek bailouts. Markets have been worrying that Spain, the euro zone's fourth-largest economy, will have to ask for financial help in excess of the 100 billion euros already approved for Madrid to bail out its banks.
Healthcare stocks will be in focus as the U.S. Supreme Court is set to deliver its ruling on President Barack Obama's 2010 healthcare overhaul, his signature domestic policy achievement. Data showed the number of Americans filing new claims for unemployment benefits fell last week, but remained too high to signal any major improvement in the labour market.
"There are no surprises here. Claims are pretty much around where they were last week. This is a lacklustre economy and I'm worried about what the June payroll will look like, but people are right now focused on health care and Europe," said Wayne Kaufman, chief market analyst at John Thomas Financial in New York.
The Dow Jones industrial average fell 103.73 points, or 0.82 percent, to 12,523.28. The S and P 500 Index dropped 10.24 points, or 0.77 percent, to 1,321.61. The Nasdaq Composite lost 30.54 points, or 1.06 percent, to 2,844.78.