Stocks fall as worries about Greek debt return

Stocks halted their steady climb last Friday after renewed concerns about Greece's ability to pay its debts left investors questioning a global economic recovery.

The Dow Jones industrial average fell 37 points after advancing for eight straight days. Broader indexes also fell. Major indexes posted gains for the week.

Markets around the world were mixed after Greece said it might need to turn to the International Monetary Fund for support if European leaders couldn't agree on a bailout plan next week.

Worries about Greece's ability to handle its massive debt load have set off periodic bouts of stock selling in the US and overseas over the past two months.

Investors also were cautious after India's central bank raised interest rates to combat rising prices. That prompted concern that central banks in other countries would follow suit. Reports in the US during the week signalled that inflation was minimal.

The news out of Greece and India chilled an advance in US stocks that grew out of rising optimism about a recovery.

"The economic data so far continues to be friendly, but there are a lot of concerns out there," said Peter Cardillo, chief market economist at the brokerage Avalon Partners Inc. in New York. "The Greek situation is affecting the dollar."

The dollar, regaining its appeal as a safe investment, rose against the euro and other currencies. Concerns remain that debt problems could spill over to other weak European countries like Spain and Portugal, Cardillo said.

According to preliminary calculations, on Friday the Dow fell 37.19 points, or 0.3 per cent, to 10,741.98, the Standard and Poor's 500 index fell 5.93 points, or 0.5 per cent, to 1,159.90, and the Nasdaq composite index fell 16.87 points, or 0.7 per cent, to 2,374.41.

The Dow had closed on Thursday at its highest level since October 1, 2008.

Broader indexes are in a similar range, so the retreat wasn't surprising. Many traders like to sell some of their stronger holdings when the market pushes to new highs.

Three stocks fell for every one that rose on the New York stock exchange, where volume came to two billion shares, compared with 924 million on Thursday.

Over the week, the Dow rose 1.1 per cent, the S and P 500 index advanced 0.9 per cent and the Nasdaq rose 0.3 per cent.