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GLOBAL MARKETS-Oil drags down U.S. stocks; Greece jitters lift bonds

Published 16/07/2015, 06:24 am
© Reuters.  GLOBAL MARKETS-Oil drags down U.S. stocks; Greece jitters lift bonds
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* Investors take Fed's Yellen rate-hike view in stride

* Oil prices fall on concerns about rising Iranian exports

* Euro off before Greek parliament vote on latest bailout

* Safety bids for U.S., German bonds emerge before Greek vote (Updates with Wall Street close, adds quote)

By Richard Leong

NEW YORK, July 15 (Reuters) - U.S. stock prices slipped on Wednesday as weaker oil prices hurt energy shares, while uneasiness about a Greek government vote on whether it would accept tough terms for another bailout and protests against a debt deal spurred safe-haven bids for bonds.

Oil prices fell more than 2 percent due to worries of growing supply from Iran following a landmark deal that would lift sanctions that have curbed its oil sales for several years. ID:nL4N0ZV25H

Protesters threw petrol bombs at Greek police outside parliament in Athens as lawmakers prepared to vote on a painful austerity package. ID:nL5N0ZV0Y1

"It looks like investors are worried there could be a glitch there. I think the consensus is it's still going to pass the Greek parliament, but in the meantime, the buyers have stepped aside," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

Wall Street took in stride Federal Reserve Chair Janet Yellen's affirmation of a likely interest rate increase by year-end. "If the economy evolves as we expect, economic conditions likely would make it appropriate at some point this year to raise the federal funds rate," she said in a testimony prepared for a U.S. House panel. ID:nN9N0ZU000

The Dow Jones industrial average .DJI closed down 3.41 points, or 0.02 percent, to 18,050.17, the S&P 500 .SPX ended 1.52 points, or 0.07 percent, lower at 2,107.43 and the Nasdaq Composite .IXIC finished down 5.95 points, or 0.12 percent, to 5,098.94.

The dollar strengthened against a basket of currencies, with the dollar index last up 0.6 percent at 97.20 .DXY .

After receiving no fresh clues on the timing of a Fed rate increase, traders awaited whether Greece's parliament will approve a third bailout to avert bankruptcy and Greece's possible exit from the euro zone.

The euro was down 0.5 percent against the dollar at $1.09520 EUR=EBS and 0.2 percent lower at 135.535 yen EURJPY=EBS .

The pan-European FTSEurofirst 300 index .FTEU3 closed up 0.4 percent at 1,586.50, rising five days in a row.

Uncertainties over the Greek vote outcome helped spur demand for bonds. Yields on 10-year German Bunds DE10YT=TWEB fell 9 basis points to 0.76 percent, while U.S. 10-year Treasuries yields US10YT=RR declined 4 basis points to 2.358 percent. ID:nL2N0ZV1X7

Earlier, some Asian and emerging market stocks fell despite better-than-expected Chinese economic data. ID:nL5N0ZV0OF

In the oil market, Brent crude LCOc1 was down 1.46 cents or 2.50 percent at $57.05 a barrel, while U.S. oil futures CLc1 settled down $1.63 or 3.07 percent at $51.41. ID:nL4N0ZV25H

Spot gold prices XAU= were down 0.5 percent at $1,148.43 an ounce. ID:nL4N0ZV308

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