US stocks were little changed as investors took the victory of an antiausterity party in the Greece weekend election lightly.
According to The Wall Street Journal the Dow Jones Industrial Average dropped 0.2% or 30 points to 17,642 while the S&P 500 dropped 0.5% or 10 pouts to 2,052. The Nasdaq Composite Index climbed 0.1% or 5 points to 4,762.
On Sunday, in the Greek national elections, voters handed power to a radical party, which has spoken out against the fiscal austerity that is imposed on Greece in exchange for international bailout for its economy.
Stocks for Greece dropped on Monday, but the effect on other European markets seemed limited.
Tom Wright, director of equities at JMP Securities said, “There’s this rationale where, politically, what happened in Greece is interesting and something to keep an eye on, but Greece is a tiny country. I think we’ve learned that, in an of itself, it should not have much of a ripple into our market.
While Greece has a relatively small economy that the United States has limited exposure to, extended volatility in the region might hurt multinational companies.
Reuters quoted Frank Davis, director of sales and trading at LEK Securities as having said, “The ongoing display of angst is that Greece removes itself from the euro-zone. It’s the unknown about things breaking up. We consider that a remote possibility, but it makes sense for us to take a pause and reassess our fundamentals.”
On Monday, MeadWestvaco Corp. and Rock-Tenn Co. agreed to merge in a deal with a combined value of equity of around $16 billion. Rock-Tenn shares climbed 8.4% and those of MeadWestvaco rose 16%.
Post Holdings Inc. agreed to purchase the privately held MOM Brands Co. for $1.15 billion. Shares of post climbed 11%.
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