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Stocks set to dip on fresh fears about Greece

By CNNMoney staff October 3, 2011: 7:39 AM ET

NEW YORK (CNNMoney) — On the first trading day of the fourth quarter, U.S. stocks were poised to fall at the open; following a sell off in world markets, as investors fret over Greece’s ability to avoid default and a slowing global economy.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were all lower ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

Investors are watching closely as Greece attempts to deal with its debt crisis. Greece has slashed spending, reduced wages and raised taxes in an attempt to bring its debt under control.

But even still, the debt-ridden nation will miss key deficit targets for this year and next, according to the draft budget announced by the Greek cabinet late Sunday.

There isn’t a whole lot of optimism that Greece will pull though. Out of 22 economists surveyed by CNNMoney, almost all of them believe Greece will default on its debt by the end of next year. The third quarter is over. Good riddance!

Stocks were hammered Friday, with all three major stock indices shaving more than 2%, as investors remain worried about the debt crisis in Europe and the outlook for global economic growth.

The losses capped the biggest quarterly drop for the S&P 500 and the Nasdaq since the fourth quarter of 2008. The S&P 500 lost 14%, and the Nasdaq fell 13% over the last three months. The Dow fell 12% in the quarter, marking its worst quarterly performance since the first quarter of 2009.

In addition to fretting over the sovereign debt crisis in Europe, investors are anxious about slowing economic activity in the United States and around the world. The Federal Reserve and the International Monetary Fund both warned of increasing risks to the global economic recovery.

World markets: European stocks were sharply lower in morning trading. Britain’s FTSE 100 (UKX) fell 1.6%, the DAX (DAX) in Germany tumbled 2.3% and France’s CAC 40 (CAC40) dropped 2.1%.

Asian markets also ended lower. The Hang Seng (HSI) in Hong Kong plunged 4.4%, while Japan’s Nikkei (N225) shed 1.8%. The Shanghai Composite (SHCOMP) is closed this week for holiday.

Economy: Wall Street will get the Institute for Supply Management’s August manufacturing index, as well as construction spending figures from the Commerce Department.

Economists expect the September ISM index will fall to a reading of 50.5, from last month’s 50.6. Construction spending figures are expected to decrease 0.5% — coming in above last month’s 1.3% decrease.

Major auto manufacturers will also report auto sales for September at 3 p.m.

Companies: Shares of Eastman Kodak (EK, Fortune 500) dropped almost 60% Friday. Trading halted on the stock several times, amid rumors that the camera maker has hired a law firm for advice on a major restructuring or bankruptcy filing. The company later denied that it is planning bankruptcy moves. Shares rebounded 46% in premarket trading Monday.
Europe’s Debt Crisis

In response to a question following the China 2.0 conference at Stanford University — Jack Ma, the CEO of Chinese Internet conglomerate Alibaba Group, said that his company would be “interested” in buying all of struggling online media firm Yahoo (YHOO, Fortune 500). Shares of Yahoo rose almost 6% in premarkets.

Apple’s new CEO, Tim Cook, will take the stage at the Town Hall auditorium on Apple’s (AAPL, Fortune 500) Cupertino, Calif., campus Tuesday to unveil the new iteration of the iPhone. Rumors are swirling over whether there will be one new iPhone or two. Shares of Apple edged higher in premarket trading.

Currencies and commodities: The dollar gained against the euro and the British pound, but lost ground against the Japanese yen.

Oil for November delivery lost 81 cents to $78.39 a barrel.

Gold futures for December delivery rose $37.60 to $1,659.90 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury edged up slightly, pushing the yield down to 1.90%. To top of page

Source CNN Money

7 responses to “Stocks set to dip on fresh fears about Greece”

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  8. Gert says:

    Even after the bailout vote fails, the market rises on hopes it will succeed after a new try. What a gullible breed.

    Can’t wait to see the headline: “After the complete collapse of the western economy, the market rallied on hopes it will be rebuilt after a century of turmoil.”

  9. Paul says:

    The dollar and other fiat currencies are bubbles. The $15 trillion national debt is a bubble. Gold and silver reacting to those two bubbles is NOT a bubble. What’s really amazing is all of the people who come out everytime there is an article on gold and start screaming how worthless it is. When every chump in the country was paying $300 a share for internet companies with negative earnings, I wasn’t wasting my time trying to convince myself I was right for not jumping on the band wagon. If you don’t see the value of precious metals, you must think that the people running the show have some magic tricks up their sleeves that will solve of our problems. To each their own. I’m betting that the only people who know what’s wrong with our economy and how to fix it are A) not running for public office, or B) don’t have a snowball’s chance in hell of getting elected. We gonna find out who’s right in the not too distant future.

  10. Robert says:

    Where do we go from here? Will the stocks go up or down?

  11. Ricci says:

    It’s difficult to find a job today and I was thinking if a stock trading or investing for a living could be an option?

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