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Stocks mostly fall at open as dollar rises

Stocks mostly fall at open as dollar rises

Stocks were mostly lower in early trading Wednesday as a stronger dollar weighed on commodities prices.
Some investors have been buying the dollar in recent weeks on the belief that the U.S. economy is improving and the Federal Reserve will raise interest rates in the next year. That buying interest comes after a monthslong slide in the greenback. Rock-bottom interest rates have encouraged investors this year to move out of cash and into riskier assets like stocks and commodities that have the potential to earn bigger returns.
While a rise in the dollar would be a sign that the economy is on the right track, it could hurt the stock market's advance. A stronger dollar makes commodities more expensive for foreign buyers and can hurt the profits of companies that do business overseas.
There are still plenty of reminders that corporate America is still hurting from the recession.
According to a person with knowledge of the matter, the government is preparing to extend another multibillion bailout loan to GMAC Financial Services to further stabilize the auto financing company. GMAC, instrumental to the operations of automakers General Motors Co. and Chrysler Group LLC, has already received $12.5 billion in taxpayer money and is 35 percent owned by the federal government. The person, who spoke on condition of anonymity because discussions weren't complete, said the new infusion would be in the range of about $3 billion.
Meanwhile, health insurer Aetna Inc. said it expects to take a fourth-quarter charge of up to $65 million to cover the costs of layoffs and consolidations.
The decline in stocks added to modest losses on Tuesday when the market ended a six-day winning streak as reports on home prices and consumer confidence failed to rally investors. While the reports showed improvement, they were largely in line with expectations and painted a picture of a slowly recovering economy.
After a 24.7 percent rise in the Standard & Poor's 500 index this year, many investors have closed their books and are making few moves ahead of the start of 2010. With fewer traders in the market, price swings can be exaggerated.
The Dow Jones industrial average fell 11.56, or 0.1 percent, to 10,533.85. The Standard & Poor's 500 index fell 1.26, or 0.1 percent, to 1,124.93, while the Nasdaq composite index rose 3.02, or 0.1 percent, to 2,291.42.


Updated : 2021-01-22 05:13 GMT+08:00