U.S. stocks dipped on Tuesday while German bond yields rose as investors searched for clarity over whether a high-level meeting on Greece’s debt crisis might yield a significant breakthrough.
The euro rose nearly 2 percent against the dollar, after an above-forecast rise in euro zone inflation pushed the currency through the $1.10 resistance point.
Greece’s creditors are close to finishing a draft agreement to put to the leftist government in Athens, a source close to the talks said on Tuesday, injecting new momentum into long-running negotiations to release aid for the cash-strapped country.
Yannis Stournaras, the head of the Greek central bank, said an agreement between Athens and its creditors from the euro zone and International Monetary Fund to keep the country afloat was “not far away”.
“It is all revolving around the climactic situation in Europe,” said Ken Polcari, Director of the NYSE floor division at O’Neil Securities in New York.
“I really think there is going to be some clarity to it today, they are going to push the envelope and that is what the market is focusing on.”
Athens is due to make a 300 million euro debt repayment to the International Monetary Fund on Friday.
U.S. stocks were modestly lower after economic data showed new orders for U.S. factory goods unexpectedly fell in April, the eight decline in the last nine months.
Investors were also closely watching the technical support level at the 50-day moving average for the S&P 500 at 2,099.54. The benchmark index touched a session low of 2,099.14 before rebounding.