NEW YORK — U.S. stocks fell moderately in afternoon trading Tuesday, but the declines were much smaller than those in overseas markets.
European markets dropped after Greece officials called an early presidential vote, which investors feared could jeopardize the country’s bailout program. Greece’s stock market suffered its biggest one-day loss since 1987. Stocks in China stumbled, interrupting a months-long surge, after regulators there tightened rules for lending.
KEEPING SCORE: The Dow Jones industrial average had its biggest drop in two months in early trading, falling as much as 222 points, or 1.3 percent. By midday, the average was off less than half of that, down 91 points, or 0.5 percent, to 17,724. The Standard & Poor’s 500 index fell seven points, or 0.3 percent, to 2,053. The Nasdaq composite was up five points, or 0.1 percent, to 4,746.
EUROPE: The losses in Europe were deeper. France’s CAC-40 closed down 2.6 percent and Germany’s DAX lost 2.2 percent. Britain’s FTSE 100 shed 2.1 percent.
GREECE PLUNGE: The Athens stock exchange plunged 13 percent, its biggest one-day drop in almost 30 years. Investors are worried that the country might have to hold early general elections and that a left-wing opposition party would win. The Syriza party wants a cut to what Greece owes in bailout money, which could spook investors for years and derail the country’s recovery.
“It’s somewhat of a gamble the prime minister is playing,” said Phil Camporeale, a portfolio manager for J.P. Morgan Asset Management. “While there isn’t the contagion issue there was in Europe two years ago, it’s still not good for the eurozone.”
CHINESE MARKETS: Major Chinese oil and bank stocks fell, some by the daily limit of 10 percent allowed by regulators, after China’s clearing house for securities trades raised the minimum rating for corporate bonds it would accept in exchange for short-term credit. That prompted concerns about the availability of financing for trades.
Tuesday’s decline in Chinese stocks was a break from a buying frenzy that has pushed the Shanghai benchmark up 41 percent since June.
THE QUOTE: Hu Guopeng, an analyst at Founder Securities in Beijing, said the plunge in China’s stock markets was a “technical correction” linked to the uncertainty about credit availability created by the change in collateral requirements. It “does not mean the end of the market boom,” Hu said.
OUT OF STYLE: Teen apparel company Abercrombie & Fitch rose $1.77, or 7 percent, to $28.13 after the company said its CEO, Mike Jeffries, is retiring immediately. Jeffries is credited with transforming A&F in the 1990s, but the company has struggled to keep up with recent trends. The stock is down 14 percent this year.
BUSY SIGNAL: Verizon fell $2.08, or 4 percent, to $46.82 after the company said its wireless division’s recent practice of deep discounting and buying out competitors’ contracts could hurt the company’s profit margins going forward. Shares of AT&T, another major wireless carrier, were hurt as well by the news. AT&T fell 97 cents, or 3 percent, to $32.91
ENERGY: U.S. benchmark crude rose 49 cents to $63.54 a barrel in New York. The contract plunged $2.79 on Monday to its lowest level in five years.
CURRENCIES and BONDS: The dollar declined 1.7 percent against the Japanese currency to 119.16 yen. The euro rose 0.1 percent to $1.2391. In government bond trading, the yield on the 10-year Treasury note fell to 2.21 percent from 2.26 percent late Monday as prices rose.