With traders expressing renewed concerns about the financial situation in Europe, stocks moved sharply lower at the start of trading on Monday. The major averages showed notable downward moves, more than offsetting the gains posted last week.
The major averages have seen some further downside in recent trading, falling to new lows for the young session. The Dow is down 239.16 points or 1.9 percent at 12,583.41, the Nasdaq is down 71.03 points or 2.4 percent at 2,854.27 and the S&P 500 is down 24.98 points or 1.8 percent at 1,337.68.
The sell-off on Wall Street comes as worries about the ongoing European debt crisis have resurfaced amid indications that Spain could require a full bailout.
Contributing to the worries about Spain, the country's central bank said Spanish GDP fell by 0.4 percent in the second quarter following a 0.3 percent contraction in the first quarter.
Traders also remain concerned about developments in Greece, with officials from the country's troika of international creditors due to visit Athens on Tuesday to review the progress Greece has made with respect to enacting reforms and austerity measures.
Germany's Der Spiegel has reported that the International Monetary Fund does not want to provide Greece with any additional financing.
Peter Boockvar, managing director at Miller Tabak said, "From the perspective of its creditors, particularly the Germans, the moment of 'enough is enough' is about to be reached with Greece."
The focus on Europe comes amid a lack of major U.S. economic data, although key reports on second quarter GDP, new home sales, durable goods orders and consumer sentiment are scheduled to be released later in the week.
Steel stocks are seeing substantial weakness in early trading amid concerns about the outlook for global demand. The NYSE Arca Steel Index has tumbled by 4 percent, hitting its lowest intraday level in almost a month.
Considerable weakness has also emerged among technology stocks, which are giving back some ground after moving notably higher in recent sessions. Software, computer hardware, and networking stocks are posting notable losses.
Most of the other major sectors have also come under pressure, with significant weakness visible among oil, gold, airline, and healthcare stocks.
In overseas trading, stock markets across the Asia-Pacific region saw significant weakness during trading on Monday. Japan's Nikkei 225 Index fell by 1.9 percent, while Hong Kong's Hang Seng Index plummeted by 3 percent.
The major European markets are also moving sharply lower on the day. The U.K.'s FTSE 100 Index is tumbling by 2.2 percent, while the French CAC 40 Index and the German DAX Index have plunged by 3.2 percent and 3.6 percent, respectively.
In the bond market, treasuries have moved to the upside amid the substantial weakness among stocks. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.9 basis points at 1.421 percent.
by RTT Staff Writer
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