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US stocks sink as EU crunch week begins

Tuesday, June 26, 2012
AFP


NEW YORK--U.S. stocks dropped over one percent on opening Monday as another crunch week for the eurozone began and the health industry awaited a landmark Supreme Court ruling on the Obama administration's health reforms.

Major industry groups were down across the board, led by energy stocks, thanks to dropping oil prices: ExxonMobil lost 2.8 percent, Chevron 2.1 percent, and Total's U.S.-traded shares 2.9 percent.

Thirty minutes into trade the Dow Jones Industrial Average had given up 126.69 points (1.00 percent) to 12,514.09.

The S&P 500 slid 17.05 (1.28 percent) to 1,317.97, while the tech-rich Nasdaq lost 38.46 (1.33 percent) to 2,853.96.

Analysts said the key fears driving selling were that European leaders would not be able to bridge differences over a banking union and Greece's bailout terms to settle the financial markets.

“The problem for the market this morning isn't these news items per se,” said Patrick O'Hare of Briefing.com.

“Rather, it is the understanding that these news items underscore the reality that almost nothing has changed — at least not in a good way anyway as it pertains to the eurozone's debt crisis.”

Health care industry shares fell amid worries the Supreme Court could strike down major portions of the government's reform package that would ultimately hit the earnings of hospital operators and drug companies.

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