NEW YORK —Stock indexes closed slightly lower Monday as
French President Nicolas Sarkozy and German Chancellor Angela Merkel warned Greek leaders that they need to push through fresh cost-cutting measures or risk default.
But the Greek prime minister and leaders of parties backing his coalition government postponed talks for a day, despite European leaders’ prodding of Athens to enact new spending cuts, layoffs and other austerity measures.
The Dow Jones industrial average fell 17.10 points to close at 12,845.13. Travelers led the Dow lower with a 1.3 percent loss.
In other trading, the Standard & Poor’s 500 slipped 0.57 of a point to 1,344.33. The Nasdaq composite fell 3.67 points to 2,901.99.
Sam Stovall, chief equity strategist at S&P Capital IQ, thinks investors are starting to wonder whether the stock market’s recent stretch of calm trading is a prelude to a big drop. Trading has turned subdued compared with the wild swings of 2011. The S&P has closed up or down by more than 1 percent only three times this year. In December, that happened nine times.
“I look at it like a very low-tide warning of an impending tsunami,” Stovall said. “We’re setting ourselves up for a decline, the sort of decline that would make you sit up and take notice.”
A worrisome sign, Stovall said, is a drop in the number of volatile trading days in which the S&P index ends lower. There have been only five days in the past month in which the S&P index has moved by more than 1 percent and then ended with a loss. That’s half of the monthly average since 2000. On April 29, the S&P 500 hit its peak for the year after an even calmer period, then lost 19 percent before hitting bottom Oct. 3.
Large gains in the market, like the Dow’s 156-point surge Friday, are often followed by relatively modest moves as traders pull some of their winnings off the table. Since 1950, whenever the S&P rose by 1 percent or more in a trading day, the index has inched up an average of just 0.1 percent the next day, according to S&P Capital IQ.
Among companies making big moves:
• Boeing fell 1.2 percent following reports that the company found a problem in its 787 Dreamliner. The company said it was working to fix it and there was no safety concern.
• Verizon and Coinstar edged up after the companies said they would launch a video-streaming service later this year, a challenge to Netflix. Coinstar — parent of Redbox, a DVD rental company, rose 1.8 percent. Verizon rose 0.8 percent.
