Wall St. drops with commodities
Stocks fell on Friday, following the Dow's eight consecutive days of gains as a rising dollar hurt oil prices and weighed on energy stocks.
Renewed worries about Greece's debt problems sent the euro to more than a two-week low against the greenback. The stronger dollar, in turn, hit the price of dollar-denominated commodities such as oil and gold because it makes them more expensive for holders of other currencies.
Uncertainty over Greece is pushing the dollar higher, and the recent gains we've seen in the commodity space is because the dollar has been depreciating, said Joe Arsenio, president of Arsenio Capital Management in Larkspur, California.
That effect spilled over to energy stocks, with the S&P Energy Index <.GSPE> down 1.3 percent as U.S. crude oil futures <.CLc1> lost 2.4 percent to $80.25 a barrel. Dow component Exxon Mobil
A looming congressional vote to overhaul the U.S. healthcare system will keep health-sector stocks in focus, with the Morgan Stanley Healthcare Payor index <.HMO> up 2.1 percent. In addition, Aetna Inc
That Aetna is giving that outlook ahead of the legislation is a positive sign for the sector's strength, said David Katz, chief investment officer of Matrix Asset Advisors in New York. He added, though, that there were still uncertainties about the bill's potential impact on stocks.
The Dow Jones industrial average <.DJI> dropped 55.02 points, or 0.51 percent, to 10,724.15. The Standard & Poor's 500 Index <.SPX> fell 6.70 points, or 0.57 percent, to 1,159.13. The Nasdaq Composite Index <.IXIC> lost 21.35 points, or 0.89 percent, to 2,369.93.
Boeing Co
The top drag on the Dow was 3M Co
Weighing on the Nasdaq was Palm Inc
, which tumbled 26.2 percent to $4.15 a day after it warned that quarterly revenues would be far below expectations as low demand for its smartphones left wireless carriers with excess inventory.
SunPower Corp
Electronics retailer Best Buy
Regarding Greece and its huge debt burden, the European Union's monetary affairs chief urged the bloc's leaders to agree on a standby aid package for Greece next week. But investors fear German reluctance could hinder the effort.
The near-term market outlook is cautious because there are still so many uncertainties about Greece, Arsenio said.
Volume has been thin during the week and volatility has dropped considerably. The CBOE Volatility Index <.VIX> is down roughly 5 percent this week and hit its lowest mark since May 2008.
Friday marks the second day of a convergence known as quadruple witching, when four types of options and futures contracts expire, possibly triggering volatility and higher volumes.
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