US stocks rise slightly in quiet trading; oil drops for third-straight day

MarketsAssociated Press

U.S. stocks rose modestly in late morning trading Wednesday, recovering part of a steep loss from the day before. Investors remain focused on Greece's debt problems.

KEEPING SCORE: The Dow Jones industrial average rose 114 points, or 0.6 percent, to 18,116 as of 11:31 a.m. Eastern. The Dow sank 190 points on Tuesday. The Standard & Poor's 500 index rose 13 points, or 0.6 percent, to 2,116 and the Nasdaq composite added 43 points, or 0.9 percent, to 5,076.

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MERGER APPROVAL: Tobacco companies Lorillard and Reynolds American rose after the Federal Trade Commission gave its tacit approval to the companies' $27.4 billion merger. Lorillard, maker of Newport cigarettes, was up 77 cents, or 1.1 percent, to $72.89. Reynolds American, which makes Camel brand cigarettes, was up $1.71, or 2.3 percent, to $77.14.

STRONG GREENBACK: The U.S. dollar extended its gains after a surge the previous day. Traders sent the dollar higher following some encouraging signs on the U.S. economy, including better-than-expected home sales, durable goods and consumer confidence.

The dollar's sharp appreciation was a partial factor in Tuesday's sell-off. The strong dollar sent commodity prices falling, which in turn hit shares of material, oil and gas and industrial companies.

The dollar rose to 123.77 yen from 122.99 yen. The euro dipped to $1.0878 from $1.0881.

GREECE WATCH: Greece might miss a debt payment on June 5 if it fails to receive bailout funds from creditors, who are demanding that the country make reforms to its economy. It is unclear whether an agreement can be reached in time. Missing those payments could destabilize the country's financial system and eventually push it out of the 19-country eurozone, a step that could shake the currency union and the global economy.

Greece's Prime Minister Alexis Tsipras said Wednesday that his country is close to reaching a deal with its creditors, but stressed that "calm and determination" were needed in the final stretch of negotiations.

Germany's DAX was up 1.2 percent, France's CAC-40 index rose 1.9 percent and the U.K.'s FTSE 100 rose 1.3 percent. Greece's stock market was up 3.5 percent. Investors bid prices of Greek government debt higher, sending the yield on Greece's 10-year bond down to 11.01 percent, a sharp drop from 11.95 percent the day before.

ANXIOUSNESS: Outside of the Greece and dollar, most of investors' attention is on the Federal Reserve and when the central bank plans to start raising interest rates for the first time in almost a decade. Investors and strategists are split on when the central bank will start to raise rates, with some thinking it could be as early as September and most looking at early 2016.

Strategists argue that until the market has some more clarity from the Fed or from economic data, stocks are unlikely to post solid gains.

"It's an old but true expression: the market likes certainty. Until we get that from the Fed, stocks are unlikely to make any headway," said David Lefkowitz, a senior equity strategist at UBS.

ENERGY: Benchmark U.S. crude rose 24 cents to $58.27 a barrel on the New York Mercantile Exchange.

BONDS: U.S. government bond prices fell slightly. The yield on the 10-year Treasury note rose to 2.16 percent from 2.14 percent.