Oil drags down U.S. stocks; Greece jitters lift bonds

Wed Jul 15, 2015 4:26pm EDT
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By Richard Leong

NEW YORK (Reuters) - U.S. stock prices slipped on Wednesday as weaker oil prices hurt energy shares, while uneasiness about a Greek government vote on whether it would accept tough terms for another bailout and protests against a debt deal spurred safe-haven bids for bonds.

Oil prices fell more than 2 percent due to worries of growing supply from Iran following a landmark deal that would lift sanctions that have curbed its oil sales for several years.

Protesters threw petrol bombs at Greek police outside parliament in Athens as lawmakers prepared to vote on a painful austerity package.

"It looks like investors are worried there could be a glitch there. I think the consensus is it's still going to pass the Greek parliament, but in the meantime, the buyers have stepped aside," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

Wall Street took in stride Federal Reserve Chair Janet Yellen's affirmation of a likely interest rate increase by year-end. "If the economy evolves as we expect, economic conditions likely would make it appropriate at some point this year to raise the federal funds rate," she said in a testimony prepared for a U.S. House panel.

The Dow Jones industrial average .DJI closed down 3.41 points, or 0.02 percent, to 18,050.17, the S&P 500 .SPX ended 1.52 points, or 0.07 percent, lower at 2,107.43 and the Nasdaq Composite .IXIC finished down 5.95 points, or 0.12 percent, to 5,098.94.

The dollar strengthened against a basket of currencies, with the dollar index last up 0.6 percent at 97.20 .DXY.

After receiving no fresh clues on the timing of a Fed rate increase, traders awaited whether Greece's parliament will approve a third bailout to avert bankruptcy and Greece's possible exit from the euro zone.   Continued...

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, July 15, 2015.  REUTERS/Lucas Jackson