Bloomberg News

U.S. Stocks Fall on Japan Exports as Greece Seeks Time

August 22, 2012

U.S. stocks fell, after the Standard & Poor’s 500 Index briefly topped a four-year high yesterday, as Japan’s exports slid and Greece sought more time on policy changes while investors awaited Federal Reserve minutes.

The S&P 500 retreated 0.2 percent to 1,410.84 at 9:32 a.m. in New York. U.S. stocks fell yesterday as the benchmark index failed to remain above a four-year closing high of 1,419.04 reached in April.

“The market is currently in need of a positive catalyst to push higher, without which it will begin to question whether the recent optimism was justified,” Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers in London, wrote in an e-mail. “The Japanese trade deficit numbers have not helped sentiment.”

Japan’s trade deficit was 517.4 billion yen ($6.5 billion) in July as Europe’s sovereign-debt crisis and a slowdown in China dragged down exports. That compares with the median forecast of a 270 billion yen deficit in a Bloomberg News survey of 28 analysts.

Federal Reserve Bank of Chicago President Charles Evans said today that a weakening in global trade is “awful.” The U.S. central bank will consider circumstances in the economy and financial stability to decide whether it needs to step up monetary easing, Evans said in Beijing.

Fed Minutes

The Fed will publish today minutes of its two-day meeting that ended on Aug. 1.

Stocks worldwide fell as Greece asked for more time to carry out policy changes. Luxembourg Prime Minister Jean-Claude Juncker, the head of the euro group of finance ministers, visits Greece today. Greek Prime Minister Antonis Samaras said before the meeting that his country needs “more air to breathe” in dealing with its debt crisis.

German Chancellor Angela Merkel and French President Francois Hollande meet tomorrow to discuss the fiscal crisis, and both will talk separately with Greece’s Samaras later this week. Concessions are possible for Greece if the prime minister shows a willingness to meet the main targets set out in his country’s bailout program, a senior lawmaker with Merkel’s government said yesterday.

To contact the reporter on this story: Inyoung Hwang in New York at ihwang7@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net


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