Stocks inch up but S&P ends quarter at loss
NEW YORK — The stock market stabilized Tuesday as investors followed the latest developments in the Greek debt saga.
Stocks edged higher a day after the market had its worst day of the year, prompted by a breakdown in talks between Greece and its creditors.
The Standard & Poor’s 500 index rose 5.47 points, or 0.3 percent, to 2,063.11 The index closed out the quarter with a loss of 0.2 percent, its first quarterly decline since dropping 1 percent in the last three months of 2012.
The Dow Jones industrial average climbed 23.16 points, or 0.1 percent, to 17,619.51. The Nasdaq composite rose 28.40 points, or 0.6 percent, to 4,986.87.
In European trading, the Stoxx 50 index of leading European shares fell 1.3 percent. Germany’s DAX dropped 1.2 percent, while the CAC-40 in France fell 1.6 percent.
On the domestic front, insurance broker Willis Group Holdings said it will combine with Towers Watson in a deal valued at about $18 billion, sending Willis shares up $1.50, or 3.3 percent, to $46.90.
Bond insurers, including MBIA and Ambac, fell sharply for a second day as investors followed the debt crisis in Puerto Rico. Credit-rating firm Standard & Poor’s said that a default or restructuring of the island’s debt within six months appeared inevitable.
Puerto Rico’s governor said Monday night he would form a financial team to negotiate with bondholders on delaying debt payments and restructuring $72 billion in public debt that he says the island can’t repay.
“If Greece wasn’t happening, this would be a major story right now,” said JJ Kinanhan, chief strategist at TD Ameritrade.
MBIA dropped 36 cents, or 5.7 percent, to $6.01. The stock has fallen 36 percent in a week. Ambac Financial fell $3.08, or 15.6 percent, to $16.64.
Andrew Gadlin, an analyst who follows MBIA for the broker Odeon, estimates that the insurer has $5.8 billion of exposure to Puerto Rico’s debt.
Investors were looking forward to the government’s monthly jobs report, which will be published Thursday. A strong report is likely to increase investors’ expectations that the Federal Reserve will raise its benchmark interest rate for the first time in close to a decade this year.
Financial markets will be closed Friday in observance of Independence Day.
In currency trading, the euro fell 0.7 percent to $1.1137 while the dollar fell 0.1 percent to 122.50 yen.
Government bond prices fell slightly after big gains Monday. The yield on the 10-year Treasury note edged up to 2.35 percent from 2.33 percent a day earlier.