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GLOBAL MARKETS-Stocks fall on Greece, rate concerns; U.S. dollar dips
June 8, 2015 / 4:07 PM / 2 years ago

GLOBAL MARKETS-Stocks fall on Greece, rate concerns; U.S. dollar dips

* Dollar hit by report of comments Obama denied

* U.S. stocks dip; investors focus on Greece, rates

* European stock markets drop across the board

* China trade data helps Asian markets (Adds U.S. markets open, changes dateline, byline)

By Sinead Carew

NEW YORK, June 8 (Reuters) - U.S. and European stocks declined as investors fretted about Greece and timing of a U.S. rate hike, while the dollar fell after a wire service report, denied by President Barack Obama, that claimed to cite remarks by him on the greenback’s strength.

The pan-European FTSEurofirst 300 index finished down 0.7 percent as investors awaited news on the fate of Greece, while the U.S. benchmark S&P 500 index fell 0.2 percent as investors bet on an interest rate hike in September by the Federal Reserve after a rosy jobs report Friday.

Greece’s bailout program expires at the end of June and the country faces default on its debts.

“There are concerns that the Fed will be more aggressive regarding the timing of the hike and a steeper hike following the first one,” Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

U.S. Treasuries yields fell on Monday with benchmark yields retreating from seven-month highs as concerns about Greece and its ability to avert default encouraged safe-haven demand for low-risk government debt.

“Greece is clearly a big issue. People are watching and waiting,” said John Herrmann, an interest rates strategist at Mitsubishi UFJ Securities USA Inc. in New York.

But Turkey’s main stock index tumbled 5 percent and the lira hit a record low after the ruling AK Party failed to win a majority in parliamentary elections, leaving the country facing the prospect of weeks of political turmoil.

DOLLAR JITTERS?

The dollar dropped more than half a percent against a basket of major currencies even after Obama denied a Bloomberg report, citing an unnamed French official, that he had called the strong dollar “a problem” in conversation at the Group of Seven (G7) summit in Germany.

“Maybe he didn’t say it, but the report highlighted an undercurrent of discomfort with the level of the dollar and its negative impact on the U.S. economy and the global economy,” John Praveen, chief investment strategist at Prudential International Investments Advisers LLC in Newark, New Jersey.

The dollar index was still up 2.85 percent from May 15 even after the decline and the index has risen 6 percent in 2015.

The euro gained 0.8 percent against the dollar Monday, after a 1 percent gain in the preceding week.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.18 percent, while Japan’s Nikkei stock index ended down 0.2 percent.

China’s exports fell less than expected last month, but imports tumbled at a greater pace, stoking speculation that the economy’s slowdown will give Beijing more reason to take further stimulus steps.

The downbeat Chinese import figure did little to support an oil market already concerned about oversupply after exporter group OPEC agreed to stick by its policy of unconstrained output for another six months on Friday.

Brent crude futures fell 0.9 percent to $62.76 a barrel, after skidding 3.6 percent last week. U.S. crude was down 1 percent at $58.45. (Additional reporting by Tanya Agrawal; Richard Leong and Michael Connor; Editing by Bernadette Baum)

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