NEW YORK — U.S. stocks fell early Friday, pushed down as problems in debt-riddled Europe came to a fore.
The decline broke three days of gains, the first such streak in more than a month. Though tech stocks did well — Google rose 3 percent after announcing higher earnings — it wasn't enough to make investors forget about Europe.
Spain was the epicenter. Protestors took to the streets to voice their disapproval of government spending cuts. The Treasury minister announced that the recession would drag on into next year. And the region of Valencia announced that it needed help from the central government to pay its bills.
Spain also got official approval from the other euro-using countries for a bailout for its struggling banks. But that didn't calm markets there. Spain's borrowing costs shot up above 7 percent, meaning Spain could soon find itself unable to afford to borrow money. A major stock market index, the Ibex 35, tumbled 5 percent.
Spain has been in trouble for months, and so its latest debt problems are hardly a surprise. But just as troubling, if not more so, were the budding signs that the crisis is deepening even among Europe's relatively strong members. Germany announced Friday that the country's economic growth likely slowed in the second quarter. In the U.K., the government announced that it had to borrow more than expected in June, raising doubts about whether the government can trim its deficit as much as it had planned.
In the U.S., the Dow Jones industrial average fell 71 points to 12,872 in early trading. The Standard & Poor's 500 fell eight to 1,369. Even the Nasdaq composite index, which is heavily concentrated on tech stocks, fell 18 to 2,948.
The country's six megabanks — Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo — all fell. Investors are concerned about an array of recent challenges, including Moody's downgrades for all the banks except Wells, and job cuts at all the banks except JPMorgan.
Several major tech stocks, including Google and Microsoft, were up. Google's earnings rose as it persuaded users to click more often on online ads. Microsoft posted a loss but investors seemed not to care; the stock was flat. Google rose $9.98 to $603.04. Microsoft was essentially flat, up 7 cents to $30.75.Comment on this story
Among other stocks making big moves, Chipotle plunged 24 percent even though the burrito chain reported a big increase in profits. Analysts were disappointed that one measure of sales came in lower than expected, though it was still high by most restaurants' standards. Chipotle stock fell $95.19 to $308.25.
Advanced Micro Devices, a major chip maker, sank 13 percent after its earnings and revenue fell far short of what Wall Street analysts were expecting. AMD's net income fell 40 percent in the second quarter. The world's second-biggest chipmaker also warned that revenue will continue to be hurt through the rest of the summer by weakness in the global economy and lower consumer spending. AMD's stock fell 60 cents to $4.26.