NEW YORK – U.S. stocks opened lower on Tuesday, led by declines in energy and materials stocks as commodities prices dropped. Prices for oil and copper fell sharply Tuesday after China's government lowered the value of its currency, suggesting weakness in the world's second-largest economy. Google gained after the company announced a restructuring.
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KEEPING SCORE: The Standard & Poor's 500 index fell 14 points, or 0.7 percent, to 2,090 as of 10 a.m. Eastern time. The Dow Jones industrial average lost 157 points, or 0.9 percent, to 17,457. The Nasdaq composite index fell 27 points, or 0.5 percent, to 5,074.
CHINA'S DEVALUATION: Beijing's move to weaken its currency allowed the yuan to fall by its biggest one-day margin in a decade. The central bank said the 1.9 percent fall was due to changes aimed at making the way it sets exchange rates more market-oriented. In recent months, the yuan has strengthened along with the U.S. dollar as currencies of other developing countries weakened, hurting Chinese exporters. Exports fell by an unexpectedly large 8.3 percent in July. The People's Bank of China said market forces would be given a bigger role in setting the exchange rate, leaving open the possibility of more declines.
THE ABC: Google was the biggest gainer in the S&P 500 after the tech giant announced a new structure for the company that included separating its lucrative internet business from some of its more speculative research projects. Investors welcomed the increase in transparency that will give them a better idea of how the technology giant spends its cash. A new holding company will be named Alphabet Inc. Google's stock gained $38.15, or 5.8 percent, to $701.99.
CURRENCIES: The dollar gained to 124.95 yen from Monday's 124.82 yen. The euro rose to $1.1063 from $1.1021.
BONDS: Government bond prices rose, pushing the yield on the 10-year Treasury note to 2.14 percent from 2.23 percent on Monday.
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GREECE DEAL: Greece says it has reached an agreement with its international creditors on the broad terms of a new bailout deal. The news pushed up Greek markets, with the stock index up 1 percent and the 2-year bond yield sliding over 4 percentage points, an indication investors are less worried about a default. Officials expect the deal to be finalized Tuesday.
EUROPE'S DAY: France's CAC-40 fell 1.5 percent, and Germany's DAX lost 2.6 percent. Britain's FTSE 100 shed 0.9 percent.
ENERGY: Benchmark U.S. crude fell $1.68 to $43.27 per barrel in electronic trading on the New York Mercantile Exchange. If it closes at that level, it will be a new low for the year and the lowest level for about six years.