Markets

US stocks waver ahead of Slovakia bailout vote

NEW YORK : US stocks wobbled Tuesday ahead of a key vote in Slovakia that could determine the fate of a plan to beef

Published October 11, 2011 Updated October 11, 2011 03:02pm

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By Imad Uddin

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The Dow Jones Industrial Average fell 30.24 points (0.26 percent) to 11,402.94 by 1415 GMT.

The broader S&P 500 slid 2.25 points (0.19 percent) to 1,192.64, while the tech-heavy Nasdaq Composite bucked the trend, gaining 4.91 points (0.19 percent) to 2,570.96.

The main indexes had opened lower following Monday's heavy rallies on hopes for European political action on resolving the eurozone debt crisis. The Dow surged 2.97 percent and the Nasdaq gained 3.50 percent.

"Today, all eyes are on Slovakia (no, really) as the country is the last to vote on the new, expanded European Financial Stability Facility," David Campione at Briefing.com said in a note.

"It also just happens to be the least likely to approve the facility, which would be used toward the second bailout of Greece."

Eurozone leaders agreed in July to boost the EFSF's powers in the hope of stemming the fallout from the eurozone's deepening sovereign debt crisis which now threatens the euro project, the bloc's banking system and the economy.

The changes are key for going ahead with a second bailout for Greece and emergency recapitalization of eurozone banks.

Investors also awaited the minutes of the last Federal Reserve policy-setting meeting, slated for release in the afternoon.

After its September 21 meeting, the Federal Open Market Committee unveiled a $400 billion stimulus plan to boost the faltering economy, a move opposed by three of the Fed's policy panel 10 members.

The cautious tone on Wall Street came in the context of the start of the quarterly earnings season, with Alcoa the first Dow blue chip reporting third-quarter results after the market closes.

Alocoa shares edged up 0.2 percent.

Banks took a hit after racking up solid gains Monday. Bank of America and Citigroup dropped 1.0 percent, and investment titan Goldman Sachs shed 1.7 percent.

US car-rental firm Dollar Thrifty fell 2.7 percent to $58.80 after announcing it has rejected a takeover bid from rival Hertz and was ending an effort to find a suitable partner.

The bond market, closed Monday for a public holiday, retreated. The yield on the 10-year Treasury rose to 2.15 percent from 2.07 percent Friday, while that on the 30-year Treasury climbed to 3.07 percent from 3.02 percent.

Bond yields and prices move in opposite directions.

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