US stocks rise slightly in early trading despite weak retail sales last month

Markets Associated Press

U.S. stocks rose slightly in early trading Tuesday as traders looked over a relatively weak retail sales report and corporate earnings news. The market is coming off three days of gains. Investors are also keeping an eye on Greece a day after the country struck a preliminary deal with its creditors and a falling Chinese stock market.

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KEEPING SCORE: The Dow Jones industrial average was up 17 points, or 0.1 percent, to 17,995 as of 10:25 a.m. The Standard & Poor's 500 index was up four points, or 0.2 percent, to 2,104. The Nasdaq composite climbed 20 points, or 0.4 percent, to 5,092.

WHERE ARE THE SHOPPERS? Americans cut back spending at stores and restaurants last month, a sign that they remain cautious despite robust job growth in the past year. Retail sales fell 0.3 percent in June, the weakest showing since February, according to the Commerce Department. That followed a robust 1 percent jump in May.

EARNINGS WATCH: U.S. bank JPMorgan Chase & Co. and Johnson & Johnson both reported second-quarter earnings that were stronger than expected. Bank of America and Google are due to report later in the week. Analysts expect earnings at companies in the S&P 500 index to fall 4.5 percent compared with the prior year, according to S&P Capital IQ. That would be the first drop in earnings since 2009.

BACK TO SCHOOL: Loan servicing company Navient cut its earnings forecast because of weakened credit trends on some student loans and a drop in loans that are coming out of deferment compared with previous years. Its stock plunged $1.79, or 10 percent, to $16.57.

IN THE CHIPS? Micron Technology jumped 9 percent on reports that a Chinese company is preparing a $23 billion bid for the chip maker in what would be China's largest takeover of a U.S. company. Some media reports said that Tsinghua Unigroup Ltd. would bid $21 per Micron share, and that an offer could come this week. Micron gained $1.60 to $19.21.

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EUROPE SLIPPING: In early trading, Germany's DAX fell 0.4 percent and France's CAC 40 gained 0.3 percent. Britain's FTSE 100 fell 0.1 percent.

GREECE RESPITE: Greece struck a preliminary rescue deal with other European Union governments Monday that should avert an imminent financial collapse but guarantees years more hardship for its people. The deal removes the immediate threat Greece would default on its debts and leave the euro. But in exchange for a three-year loan program, the Greek prime minister has to persuade skeptical legislators to pass tax increases and other key demands into law by Wednesday.

ANALYST'S TAKE: "Whether Greece has walked the plank to an economic and political collapse is still unknown," said Bernard Aw of IG Markets in a report. "While the agreement is definitely very positive for market sentiments, as the prospects of Grexit have significantly reduced, this does not mean the odds are eliminated in the medium term."

CHINA'S WOBBLE: The main Chinese index rose lost 1.2 percent after rising for three sessions through Monday. The government has been trying to halt a slide that saw the Shanghai Composite Index lose as much as 30 percent over the past month. State-owned brokerages and government pension funds have pledged to buy stocks, and executives and big shareholders are barred from selling. Hundreds of companies have suspended trading in their shares. Analysts say it is unclear whether the market can hold up once temporary barriers to selling are relaxed.

ASIA'S DAY: Tokyo's Nikkei 225 rose 1.5 percent and Sydney's S&P ASX 200 advanced 1.9 percent. Hong Kong's Hang Seng declined 0.4 percent. South Korea's Kospi lost 0.1 percent.

ENERGY: Benchmark U.S. crude oil rose 27 cents to $52.47 a barrel in New York following news that Iran had struck an international nuclear deal.

CURRENCIES: The dollar declined to 123.28 yen from 123.54 yen Monday. The euro rose to $1.1025 from $1.1003.

BONDS: U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 2.39 percent from 2.45 percent late Monday.

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McDonald reported from Beijing.