Stocks erased gains following a report that a European official said the Cyprus bank- restructuring plan should be seen as a template for the rest of the euro region. The euro weakened against 15 of 16 major peers while Italian and Spanish bonds erased gains.
The Standard & Poor’s 500 Index was down 0.1% at 1,554.84 as of 11:04 a.m. in New York after climbing as high as 1,564.91, within one point of its 2007 record close. The Stoxx Europe 600 Index was little changed after rising as much as 1%. Italy’s 10-year bond yield rose six basis points to 4.57% after decreasing eight points earlier and Spain’s yield jumped 10 points. Ten-year Treasury yields were down one point at 1.92%, while crude oil and natural gas led commodities higher.
Stocks turned lower and the euro extended losses as Reuters reported that Dutch Finance Minister Jeroen Dijsselbloem said euro-area nations with large banking industries must look to restructure and reduce their overall size. Cyprus agreed to the outlines of an aid package in a deal that imposes losses that two European Union officials said would be no more than 40% on uninsured depositors at Bank of Cyprus Plc, the largest bank, which will take over the viable assets of Cyprus Popular Bank Pcl, the second-biggest, which will be wound down.
Among U.S. stocks, Caterpillar Inc., International Business Machines Corp. and Walt Disney Co. lost more than 0.6% to lead the Dow Jones Industrial Average lower.
Apollo Group Inc. surged 8% after the for-profit education company’s quarterly earnings topped estimates. Dell Inc. climbed 3% after saying Blackstone Group LP and activist investor Carl Icahn have submitted proposals to buy the maker of personal computers. BlackBerry slumped 4.2% after Goldman Sachs Group Inc. lowered its rating on the stock.
The euro erased an earlier gain against the dollar after the provisional agreement was struck that would make Cyprus the fifth country to get a rescue since the debt crisis broke out in Greece in 2009. The shared currency fell 0.7% against the dollar last week, the most since the five days ended March 1, and tumbled 1.5% versus the yen, the most since the week ended Feb. 8.
European banks in the Stoxx 600 erased earlier gains to slump 1.7% as a group.
Vodafone Group Plc gained 2.2% after the Sunday Times reported that the world’s second-largest mobile-phone operator has held talks to sell its stake in Verizon Wireless to Verizon Communications Inc. The newspaper cited unidentified bankers and investors.
Japan’s Topix Index of shares climbed 0.8%, rebounding after the first five-day drop in five weeks. Japanese bonds also rose, sending 10-year and 20-year yields to the lowest in almost a decade, on expectations that Bank of Japan Governor Haruhiko Kuroda will use parliament testimony tomorrow to outline new stimulus.
The Hang Seng Index gained 0.6% in Hong Kong, rallying from losses in the previous two weeks. Thailand’s SET Index rose 3%, its biggest gain since October 2011.