U.S. and global stocks fell Tuesday as investors closed their positions ahead of the New Year and amid concern over political uncertainty in Greece.
Keeping score: The Dow Jones industrial average fell 47 points, or 0.2 percent, to 17,990 as of 12:05 p.m. Eastern. The Standard & Poor’s 500 index lost six points, or 0.3 percent, to 2,085 and the Nasdaq composite was down 16 points, or 0.3 percent, to 4,791.
Greek uncertainty: Greek stocks stabilized after a volatile day Monday as the country’s government was forced to call elections that could bring more economic turmoil. Investors worry that the elections might be won by the left-wing opposition Syriza party, which rejects Greece’s bailout deal. At one point, the Athens stock market plunged 11 percent on Monday before recovering some of those losses to close down 4 percent.
Analyst’s take: “An election puts all sorts of doubt on the future of the bailout agreement given anti-austerity party Syriza is currently leading the polls,” said Stan Shamu, a market strategist at IG Markets. “Potentially markets had already priced this in, but I would still remain cautious around Greece.”
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Europe: France’s CAC 40 fell 1.7 percent, Germany’s DAX dropped 1.2 percent and Britain’s FTSE 100 was down 1.3 percent.
Closing out the year: At this point, most major fund managers have closed their portfolios for 2014. Stock trading is expected to be quiet until the week after the New Year, when most of Wall Street is back from the long holiday weekend. Roughly 2.4 billion shares traded on the New York Stock Exchange on Monday, compared with the 3.5 billion typically traded on an average day.
With one more trading day in 2014, the S&P 500 is up 12.7 percent, or 15.4 percent including dividends, almost double what stock market strategists expected at the beginning of the year.
“There were some negative surprises along the way, including the Ebola scare and increasing social tensions around the globe. However, U.S. markets were able to weather these problems as (the U.S. economy) improved,” Gary Thayer, chief macro strategist at Wells Fargo Advisors, wrote in a note to investors.
Bonds and currencies: The dollar fell to 119.34 yen from 120.66 yen while the euro rose to $1.2173 from $1.2154. The yield on the benchmark 10-year U.S. Treasury note fell to 2.18 percent from 2.20 percent Monday.
Energy: Benchmark U.S. crude fell 14 cents to $53.50 a barrel on the New York Mercantile Exchange. On Monday, the contract plunged $1.12 to settle at $53.61.