The political crisis in Greece weighed heavily on the minds and portfolios of investors today.
This story first appeared in the May 15, 2012 issue of WWD. Subscribe Today.
The U.S.-centric S&P Retail Index fell 1.6 percent, or 9.99 points, to 615.65, as the Dow Jones Industrial Average declined 1 percent, or 125.35 points, to 12,695.35. Milan’s FTSE MIB fell 2.7 percent to 13,660.87, as Paris’ CAC 40 sank 2.3 percent to 3,057.99, London’s FTSE 100 dropped 2 percent to 5,465.52 and Frankfurt’s DAX retreated 1.9 percent to close at 6,451.97.
Greek president Karolos Papoulias is struggling to form a coalition government, but the country’s political parties are increasingly divided over pro- and anti-austerity policies and cannot reach a consensus.
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Talks with political leaders were set to continue into the evening and speculation that Greece could exit the currency bloc intensified. The governors of Belgium’s and Ireland’s central banks have both spoken openly about a “managed” exit by Greece from the common currency.
Euro zone finance ministers are meeting in Brussels this week to discuss the situation in Greece and Spain.
Most retailers on Wall Street were caught in the down draft fueled by the political uncertainty.
Among the decliners were The Bon-Ton Stores Inc., down 6.4 percent to $4.56; The TJX Companies Inc., 3.8 percent to $39.70; Sears Holdings Corp., 3.6 percent to $52.71, and Macy’s Inc., 3.4 percent to $36.68.
Bucking the trend was Avon Products Inc., which saw its stock gain 3.8 percent to $20.96 after the direct merchant said Sunday it would respond within a week to suitor Coty’s demand that it open its books so Coty can determine the amount of its bid.
In Europe, the biggest decliners included Asos.com, down 3.4 percent to 15.51 pounds; Geox, 3 percent to 1.87 euros; Yoox, 4.1 percent to 10.07 euros, and Safilo Group, 2.4 percent to 4.73 euros.
Among the few stocks that gained ground were Tod’s, which was up 0.6 percent to 81.70 euros, and Arcandor, which rose 3.7 percent to 0.03 euros.
The euro traded at $1.29 while the pound went for $1.61.