U.S. Stocks Fail to Hold Early Gains

NEW YORK, May 16 (Xinhua) -- The U.S. stocks failed to hold early gains on Wednesday and ended lower for the third straight day, as fears about Europe overshadowed relatively upbeat U.S. economic data.

When the market closed, the Dow Jones industrial average fell 33.45 points, or 0.26 percent, to 12,598.55. The Standard & Poor's 500 was down 5.86 points, or 0.44 percent, to 1,324.80. The Nasdaq Composite Index lost 19.72 points, or 0.68 percent, to 2,874.04.

Major indexes rebounded in morning trading as investors took a breather after recent losses.

Market sentiment was boosted a little after the U.S. government said housing starts rebounded in April from a five-month low.

Meanwhile, the Federal Reserve reported that industrial production rose 1.1 percent in April, the fastest growth in over a year.

However, concerns over the Greek political and economic future took the center stage in the afternoon.

The failure of Greek party leaders to form a coalition government after the election raised concerns that the eurozone country would have to exit the currency union.

Although German Chancellor Angela Merkel said she wanted Greece to stay in the eurozone, trying to comfort the nervous market, and the trend of bank deposit withdrawals in Greece was said to have slowed down on Wednesday, the fact that Greek banks suffered 700 million euros (about 890 million U.S. dollars) of withdrawals on Monday alone still scared investors and caused risk aversion.

Besides, there was a report saying that the European Central Bank had stopped providing liquidity to some Greek banks as they were severely undercapitalized, which added to the fears about the country's fragile financial system.