Stocks pull back as banks, Europe weigh

Brendan Mcdermid / REUTERS

Traders on the floor of the NYSE react to the Supreme Court's decision on healthcare.

By msnbc.com news services

Stocks closed Thursday?s seesaw session lower on concerns about global banks, a surprise Supreme Court ruling upholding a landmark healthcare law, and pessimism about the ability of a European summit to ease the region's debt crisis.

The Dow Jones industrial average closed the day down 25 points, having tumbled 177 points earlier in the session.

As EU leaders began the two-day summit, finance officials were working on urgent measures to diminish financial market pressure on Spain and Italy, which may be more difficult to bail out than smaller nations in the euro zone.

Recent statements from German Chancellor Angela Merkel have been at odds those of other European leaders on how to deal with the crisis.

"Angela Merkel was very adamant about the fact she isn't going to give an inch or two - the markets at this point may be looking at the statement (at the conclusion of the summit) to see if the actions match her rhetoric," said Fred Dickson, chief market strategist, D.A. Davidson & Co. Lake Oswego, Oregon.

Wall Street losses accelerated after a divided U.S. Supreme Court backed the centerpiece of President Barack Obama's signature healthcare overhaul law that requires that most Americans to get insurance by 2014 or face a penalty. The decision surprised many investors who see the law as a hallmark of a business unfriendly administration.

Related: Hospital shares rise on health ruling, insurers fall

"The proof in the pudding will come out over the next three or four days because the Supreme Court ruling, being ninety pages long, probably will require some in depth interpretation," said Dickson.

Shares of JPMorgan Chase & Co dropped after a New York Times report projected that losses from a recent botched trade could reach $9 billion, more than four times the original estimate.

U.S.-traded shares of Barclays slumped after Britain said it had brought in the fraud squad to investigate possible crimes over attempts to manipulate lending rates, a scandal that is expected to spread to other banks.

Further weighing on the financial sector, Citi Investment Research posted a bearish note on several U.S. banks including Bank of America Corp and Goldman Sachs as the slow economic recovery hurts trading.

Reuters contributed to this report.

Source: http://marketday.msnbc.msn.com/_news/2012/06/28/12463315-stocks-pull-back-as-banks-europe-weigh?lite

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