Dow off 77 as stocks struggle on weak retail sales

Updated: 5:19 p.m. ET

Stocks slumped today as bad news piled onto bad news. The Dow Jones industrials ($INDU) fell as many as 120 points at 3:45 p.m. ET before late buying trimmed the loss to 77 points.

There was the government's disappointing report on May retail sales. Worries grew about the financial risks from Sunday's parliamentary election in Greece. Greek depositors were pulling their money out of banks in case the election resulted in junking the euro as their currency. Credit Agricole (CRARY), one of France's largest banks, was reportedly making plans to sell -- or simply abandon -- its Greek subsidiary.

Then, ratings agency Egan-Jones cut its rating on Spanish debt from "B" to "CCC+," which is junk status. And mining giant BHP Billiton (BHP) cut its outlook for commodities prices over the next three to five years. The Financial Times called the report a sign that natural-resources companies "are braced for a lasting impact from the global financial crisis."

The one offset: JPMorgan Chase (JPM) CEO Jamie Dimon wowed investors -- if not critics -- in his defense of the banking giant in the aftermath of a huge trading loss in one its divisions. JPMorgan shares were up 53 cents to $34.40.

The Dow closed down 77 points to 12,496, a day after the blue chips gained 163 points and two days after falling 143 points. The Standard & Poor's 500 Index ($INX) was off 9 points to 1,315, and the Nasdaq Composite Index ($COMPX) was down 24 points to 2,819.

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The Nasdaq-100 Index ($NDX) was off 19 points to 2,527. Apple (AAPL), the biggest influence on the index, was off $4 to $572.16 after reaching as high as $578.48. Dell (DELL) was up 30 cents to $12.28 after announcing it will start paying a quarterly dividend, probably 8 cents a share, in its fiscal third quarter. The shares reached as high as $12.59.

The market's pullback showed one more time how events outside the United States can affect domestic markets. The worries about the Greek election are building. Reuters reported that Greek's largest banks are seeing deposit outflows of $625 million to $1 billion a day because of fears that a Socialist government might return Greece to its old currency, the drachma.

Plus, there was the downgrade of Spanish debt by Egan-Jones. Italy's auction of 6.5 billion euros in 1-year bonds produced yields of 3.972%, up from 2.34% in May.

American Express (AXP) shares fell $1.38 to $55.10. Vice Chairman Edward Gilligan said at a conference in New York today that second-quarter billing growth through May was 9% to 10%, slower than in the first quarter.

A rising dollar against the euro in April and May was a big reason for the slowdown. The euro is up 1.7% against the dollar this month.

The government will report on initial jobless claims and consumer price inflation on Thursday. Futures trading suggests a soft open.

Utilities -- a safe haven for many -- lead the market
As the market slumped, utility stocks, prized for their dividends, emerged as the strongest sector. Nine of 10 sectors of the S&P 500 fell back on the day.

Financial stocks were fairly strong for most of the day, thanks in part to Dimon's testimony and question-and-answer session with the Senate Banking Committee today. Wells Fargo (WFC) was up 28 cents to $31.58. SunTrust Banks (STI) gained 32 cents to $22. But regional banks were lower, including Cullen/Frost Bankers (CFR), Huntington Bancshares (HBAN) and Zions Bancorp (ZION).

Retail stocks were slammed. Macy's (M), down  $1.66 to $35.06, was the third-worst S&P 500 performer. Nike (NKE) and Urban Outfitters (URBN) were the fourth- and fifth-worst S&P performers. Also lower were housing stocks.

Crude oil moves lower; gold and copper move up
Crude oil (-CL) in New York settled down 70 cents to $82.62 a barrel. Brent crude in London was off 35 cents to $96.90 a barrel.

The retail price of regular unleaded gasoline fell to $3.539 a gallon from Tuesday's $3.542, according to AAA's Daily Fuel Gauge Report.

Gold (-GC) settled up $5.60 to $1,619.40 an ounce. Silver (-SI) was off slightly at $28.941 an ounce, while copper (-HG) rose slightly to $3.3395 a pound.

The dollar was lower against the euro and other major currencies. Interest rates fell. The 10-year Treasury yield was 1.599%, down from 1.661% on Tuesday.

Energy prices -- New York close
			Wed.			Tues.			Month chg.			YTD chg.
Crude oil (-CL)			$82.62			$83.32			-4.52%			-16.40%
(per barrel)
Heating oil (-HO)			$2.6109			$2.6215			-3.41%			-10.41%
(per gallon)
Natural gas (-NG)			$2.1850			$2.2320			-9.79%			-26.90%
(per mil. BTU)
Unleaded gasoline (-RB)			$2.6554			$2.6502			-2.47%			-0.08%
(per gallon)
Brent crude			$97.13			$97.25			-4.65%			-9.55%
(per barrel)
Retail gasoline			$3.5390			$3.5420			-2.24%			8.03%
(per gallon; AAA)

JPMorgan's Dimon concedes mistakes
JPMorgan Chase shares moved higher as CEO Jamie Dimon jousted with the Senate Banking Committee over the company's $2 billion-plus trading loss in a portfolio that was supposed to act as a hedge against big systemic events like the 2008-09 financial crisis or the eurozone crisis today.

Dimon did concede that a new risk model -- which was designed to help test the volatility of trading vehicles -- allowed too much risk and contributed to the loss, but, he reminded the committee, there were no depositor losses or losses to be borne by taxpayers.

In addition, Dimon admitted that the company provided inaccurate information about the size of the trade to regulators, arguing he didn't have good information, either.

He also said  the company may demand that responsible executives may be forced to give back some or part of their bonuses once a final review of the problem is finished.

Shareholders have taken a hit. JPMorgan shares fell nearly 24% between May 10, the day Dimon announced the loss, and June 4, when they closed at $31. They're still off 15%.

The loss occurred in the company's Chief Investment Office in London. The company has changed management and fired a number of executives as a result.

This, however, was a hearing where Dimon emerged the clear winner. Republicans used the hearing to ask what regulations should be repealed or changed. Dimon said he preferred strong, simple regulation. Democrats worried the bank was too big.

Johnson & Johnson gains on upgrades
Johnson & Johnson (JNJ) gained $1.37 to $64.45. The health care company and Dow component said it received regulatory clearance to close its $19.7 billion bid for medical-device maker Synthes.

Analysts from J.P. Morgan, Jefferies & Co. and Raymond James Financial upgraded the stock to "buy," or equivalent ratings.

Facebook (FB) was off 13 cents to $27.27. The stock had been as high as $28.10. It rose 39 cents to $27.40 on Tuesday.

Seven of the 30 Dow stocks were higher today, led by Johnson & Johnson and JPMorgan Chase. Three were unchanged: Coca-Cola (KO), Pfizer (PFE) and AT&T (T).

The Dow laggard was American Express, followed by Home Depot (HD), off $1.27 to $50.97. The stock is off 3.6% from its 52-week high of $52.88, reached on May 3.

About 88 S&P 500 stocks were higher, led by Dell, Southwest Airlines (LUV) and Johnson & Johnson. First Solar (FSLR), WPX Energy (PPX) and Macy's were the laggards.

Dell, Seagate Technology (STX) and Green Mountain Coffee Roasters (GMCR) were the leaders of the Nasdaq-100, with Virgin Media (VMED) and Expedia (EXPE) the laggards.

Short hits from the markets -- New York close
			Wed.			Tues.			Month chg.			YTD chg.
Treasury yields
13-week Treasury bill			0.0900%			0.090%			28.57%			800.00%
5-year Treasury note			0.708%			0.747%			5.51%			-14.70%
10-year Treasury note			1.599%			1.661%			1.14%			-14.54%
30-year Treasury bond			2.711%			2.772%			1.46%			-6.16%
Currencies
U.S. Dollar Index			82.057			82.449			-1.29%			1.91%
British pound			1.5586			1.5576			1.12%			0.31%
(in U.S. $)
U.S. $ in pounds			£0.642			£0.642			-1.11%			-0.31%
Euro in dollars			$1.26			$1.25			1.68%			-2.99%
(in U.S. $)
U.S. $ in euros			€ 0.796			€ 0.799			-1.66%			3.08%
U.S. $ in yen			79.55			79.57			1.27%			3.18%
U.S. $ in Chinese			6.35			6.37			-0.43%			0.44%
yuan
Canada dollar			$0.976			$0.975			0.83%			-0.47%
(in U.S. $)
U.S. dollar			$1.025			$1.026			-0.83%			0.46%
(in Canadian $)
Commodities
Gold (-GC)			$1,619.40			$1,613.80			3.53%			3.36%
(per troy ounce)
Copper (-HG)			$3.340			$3.336			-0.77%			-2.81%
(per pound)
Silver (-SI)			$28.9410			$28.9490			4.27%			3.68%
(per troy ounce)
Wheat (-ZW)			$6.1600			$6.1600			-4.31%			-5.63%
(per bushel)
Corn (-ZC)			$5.9250			$5.840			6.71%			-8.35%
(per bushel)
Cotton			$0.6926			0.6781			-3.60%			-24.45%
(per pound)
Coffee			$1.5420			1.5535			-5.37%			-32.85%
(per pound)
Crude oil (-CL)			$82.62			$83.32			-4.52%			-16.40%
(per barrel)