GREECE, REVISTED: Stocks fell Tuesday on concerns that a deal to prevent a default by Greece might fall through. A slew of U.S. corporate earnings did little to bolster investors’ confidence.

THE NUMBERS: The Dow Jones industrial average closed down 33 points at 12,676. It has risen or fallen less than 100 points in 13 trading sessions, the longest calm stretch since March and April of last year.

MOSTLY GREEN: It’s only the third time the S&P has ended lower this year, and all those declines have been less than 7 points. So far this year, it’s up 4.5 percent.

NEW YORK – New York Mayor Michael Bloomberg says the Occupy Wall Street protests have no place in his bedroom.

The mayor was asked Monday whether he had discussed the dilemma faced by the owner of the lower Manhattan protest site with live-in girlfriend Diana Taylor, who’s on the company’s board of directors.

The mayor answered “pillow talk” in his house isn’t about Occupy Wall Street or Brookfield Office Properties, which has been struggling with how to handle the protesters who’ve descended on Zuccotti Park.

The mayor said last week police would help the company enforce rules preventing encampments, then announced the company had changed its mind.

Bloomberg says he hasn’t had any direct communication with Taylor about the situation.

(Reuters) – It's time for market regulators to clear the air on high-frequency trading, a top Big Board executive said.

NYSE Euronext's (NYX.N) chief operating officer waded into the debate over rapid-fire, electronic trading with a call on Monday for regulators to say definitively whether there are problems — and put a stop to the controversy.

"Vilifying high-frequency trading because we don't like that the market is going down, because there's a lot of economic uncertainty, doesn't make a lot of sense," Lawrence Leibowitz told a conference in New York hosted by Barclays.

"To be honest, to my knowledge there's been no proof shown that high-frequency trading has been detrimental. So it's sort of unclear why there's this huge cloud," he said.

U.S. and European regulators have warned for at least two years that they could slap new restrictions on hedge funds, banks and proprietary firms that use high-frequency trading (HFT) to send high order volumes and execute short-term trades to make markets or capitalize on price imbalances.

The May 2010 "flash crash" amplified calls from some investors and politicians for a crackdown, though a regulator report said HFT did not spark the crash. HFT was in the crosshairs again in August when markets globally sold off, punctuated by swift and volatile swings.

While European Union regulators said this summer that HFT raised risks and needs addressing, Reuters reported this month that U.S. regulators have taken the unprecedented step of asking some HFT firms for their secret trading codes.

Leibowitz said it was time for some answers.

"I think what it really takes is for the regulators to actually make a statement that says we've looked at this, we've taken everybody's concerns into account, we actually looked at the numbers, and either we don't see a problem, so everyone should stop waving their hands; second, we saw a problem with participants and we are disciplining them; or third, we think there are problems and we're going to do some regulation.

"But the ominous silence of the regulators allows the fanning of the flames … and it's really not clear whether they're based in fact in any way."

Among the moves meant to shed more light on HFT, the U.S. Securities and Exchange Commission in July adopted a "large trader" rule that will reveal more operating information on HFT, including some detail on the firms' strategies.

HFT is estimated to be involved in more than half of U.S. equity trading volume, and therefore a big chunk of transaction revenue for exchanges like the New York Stock Exchange.

(Reporting by Jonathan Spicer; editing by John Wallace)

NEW YORK (Reuters) – Much of the United States may be frying in near-record temperatures but Wall Street has been feeling the heat for months. Wrangling over the debt ceiling has kept markets on edge, and investors are still waiting for a breakthrough that leads to a deal to avoid a devastating default.

Investors have viewed as extremely unlikely the possibility of a U.S. default if the federal government does not agree to raise the debt ceiling. But the odds are growing, and Congress and the White House remained at odds just a few hours before Asian markets opened on Monday.

“Unless during the course of the day there is a specific, concrete proposal that placates the market before Asian markets open, the worst-case scenario is that the markets just sell off — sell off dramatically,” said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.

White House officials and Republican leaders scrambled on Sunday to reassure global markets the United States would avert a debt default, but the two sides gave no sign they were moving closer to a deal.

White House Chief of Staff Bill Daley warned that there would be a “few stressful days” ahead for financial markets, with the deadline to lift the $14.3 trillion U.S. borrowing limit now only nine days away.

“To some degree the outcome of there being no deal has been priced in, but the discounting is not fully in the market and this is adding to uncertainty that has already been coupled with the events in Europe and expectations that growth was already going to be weak,” Krosby said.

Wall Street is set to close its worst three months in a year as July draws to an end this week after a roller-coaster ride for markets.

With euro zone leaders having reached a deal for yet another bailout for debt-laden Greece, investors will be free to chew over the rancor in Washington with even more attention.

In addition, the corporate earnings season suggests other risks could dog the market. Despite generally good results so far, there have been some worrisome signs.

The S&P 500 rallied 6 percent in the run-up to reporting season, but earnings misses from big industrial names like Rockwell Collins (COL.N) and Caterpillar Inc (CAT.N) weighed on the Dow and S&P 500 on Friday.

Earlier in the week several big consumer names such as Whirlpool (WHR.N) and Pepsi (PEP.N) warned about sluggishness in developed markets, sending their shares sharply lower.

“The market still has a high degree of skepticism in it,” said Nick Kalivas, an analyst at MF Global in Chicago, summing up the earnings season so far.

Kalivas said he will be closely following earnings from sector and economic bellwethers this week. Those include the package delivery company UPS (UPS.N), chipmaker Texas Instruments (TXN.N), and online retailer Amazon (AMZN.O).

Around 30 percent of the S&P 500′s $12.3 trillion market cap have reported earnings so far. They have outpaced consensus estimates by 3.8 percent, and only 7 percent have missed estimates, according to data from Morgan Stanley.

But share prices of those that have fallen short of estimates have taken a severe beating. Given the fragile sentiment, a few more prominent misses could derail the market.

“The market is punishing these misses more than it is rewarding beats, an asymmetry we have been calling for and we forecast will continue,” Morgan Stanley’s U.S. equity strategist Adam Parker wrote in a note to clients.

“Our view remains that first half of the year numbers are achievable, but the second half of the year looks challenged,” he said.

This week is also a big week for economic data. Fears of a slowdown in the economy have been a large driver of market volatility over the last few months, and the coming releases will be parsed very closely.

They include early regional manufacturing data from Chicago and New York, a reading of consumer sentiment, and a first reading of U.S. growth for the second quarter, expected to show the economy grew just 1.9 percent in the period.

Bob Doll, chief equity strategist at BlackRock, one of the world’s largest fund managers with around $1.6 trillion of equities under management, said last week that the U.S. economy is at a critical juncture.

Doll points out that since 1960 every time year-on-year growth has fallen under 2 percent the U.S. economy has gone into recession.

“Our bottom line view is that investors should maintain a reasonably constructive bias toward risk assets, but should also be prepared to scale back exposure if evidence of economic growth acceleration does not materialize,” said Doll.

And many believe economic activity will be depressed if a failure to raise the debt ceiling interrupts key government services such as social security and Medicare.

The uncertainty is sure to stress markets further, and fund managers hitting the beach in August may find themselves fiddling with their BlackBerrys more than the little umbrella in their cocktails.

“I need a vacation, man. After all the stuff that’s happened in the last three months I’m pretty much shot, I’m getting weird, even my 6-year-old looks at me,” said one New Jersey-based fund manager, who was packing his bags for a destination in the Caribbean as temperatures topped 100 degrees Fahrenheit in New York City.

(Additional reporting by Chuck Mikolajczak and Ryan Vlastelica; Editing by Dale Hudson)

BERNANKE SPARKS SLIDE: Remarks by Federal Reserve Chairman Ben Bernanke that dimmed hopes for a third round of bond-buying pushed stocks lower. Bernanke told lawmakers the Fed expects the economy to improve, and would only step in if there is a significant downturn in the economy.

A CLARIFICATION: Bernanke was clarifying statements he made Wednesday that left the door open to new economic stimulus measures. Investors reacted to those earlier remarks by sending stocks sharply higher.

DEBT CEILING FEARS: Ratings agency Moody’s issued a warning on the U.S. debt rating as a stalemate continued in Washington over raising the government’s borrowing limit.

NEW YORK (Reuters) – Nasdaq OMX Group Inc and Intercontinental Exchange Inc put pressure on NYSE Euronext on Tuesday to start talks by promising to pay a $350 million fee if regulators blocked their takeover attempt.

Nasdaq and ICE also said they secured committed financing from banks to back their $11.1 billion bid for NYSE and expected U.S. antitrust regulators to start a review of their bid soon. A merged Nasdaq and NYSE would have a virtual stranglehold on U.S. stock listings.

The announcement was designed to address two key concerns raised by NYSE’s board: antitrust risk and strategic fit. NYSE had earlier rejected Nasdaq and ICE’s initial bid in favor of a $9.8 billion deal with Germany’s Deutsche Boerse AG.

Nasdaq and ICE also said they would give money to NYSE to pay a 250 million euro ($357.5 million) breakup fee the Big Board parent will have to give to Deutsche Boerse if it walks away from their existing deal.

Nasdaq and ICE will split the break-up fees equally, a source familiar with the situation said.

NYSE said it will review the revised bid submitted by Nasdaq and ICE. But the $350 million reverse breakup fee offered by Nasdaq and ICE falls far short of the $1 billion or more that sources have said NYSE would likely want.

“I don’t know that it moves the needle,” said Patrick O’Shaughnessy, an equity research analyst with Raymond James. “The only real change to deal terms is the breakup fee and I am not sure that it is large enough to sway the NYSE board.”

ICE CEO Jeffrey Sprecher and Nasdaq chief Bob Greifeld said they expected the NYSE board to start conversations with them and pointed out Deutsche Boerse had not offered NYSE any fee if the German exchange failed to get regulatory clearances.

“They could be displeased with our reverse breakup fee, but the important point is that in their existing deal with Deutsche Boerse, there is no breakup fee,” Greifeld said.

Both takeover offers face tough regulatory reviews on both sides of the Atlantic, complicating things for investors betting on which bid — if any — will prevail.

The NYSE’s shares were up 1 percent at $38.70, nearly 3 percent higher than the current value of the Deutsche Boerse offer, but 9 percent below the $42.52 per share offer price in the Nasdaq-ICE bid, indicating investors expect more wrangling.

The Nasdaq-ICE bid is currently about 13 percent higher than the competing deal.

“It’s a question of, what do the shareholders want? It’s not whether NYSE management likes it or not,” Greifeld said.

NEW OFFER

Nasdaq and ICE said they have lined up financing commitments of $3.8 billion and planned to buy $66 million worth of NYSE Euronext voting shares. That would represent 0.7 percent of the company’s market value based on Monday’s closing stock price of $38.32.

The share purchase would satisfy one of the requirements Nasdaq and ICE would need to meet under U.S. antitrust laws to make a pre-merger notification, according to Richard Repetto, an analyst at Sandler O’Neill Partners.

Nasdaq has received financing from banks, including Bank of America Corp, Nordea Bank AB, Skandinaviska Enskilda Banken AB and UBS AG. ICE is getting financing from a syndicate, including Wells Fargo & Co and Bank of America.

The two have one-year committed financing, the source said.

ANTITRUST ISSUE

Nasdaq and ICE said they have begun talking with the U.S. Department of Justice’s antitrust division about their bid.

Greifeld said they were giving the department “a tremendous amount of data” and had been meeting with them.

“So it is our hope that after six or seven weeks in the process that we will start getting some feedback from them,” Greifeld said. “But making clear, it is up to them to decide how and when they are going to give us feedback. We don’t control that timing.”

Executives at all four exchanges have also taken their respective cases to NYSE shareholders.

Sprecher and Greifeld said in a letter to NYSE Euronext Chairman Jan-Michiel Hessels that early talks with NYSE shareholders have made them confident their bid was superior.

“Based on our own conversations with your stockholders, we sense that they want the Board to engage with us to determine if, in fact, our proposal is better for NYSE Euronext,” they wrote in a letter dated April 19.

Deutsche Boerse said it remained committed to its agreement with NYSE, and was moving ahead with integration planning.

Nasdaq closed down 0.6 percent at $27.40 and ICE edged down 0.4 percent to $119.33 on Tuesday.

(1 eur=$1.43)

(Reporting by Phil Wahba, additional reporting by Nadia Damouni; editing by Dave Zimmerman, Derek Caney and Matthew Lewis, Gary Hill and Andre Grenon)

LONDON (Reuters) – A proposal by Venezuela President Hugo Chavez to try to broker a peace deal in Libya briefly pushed oil lower on Thursday, while recently risk-averse stock markets put in some gains.

European markets were volatile ahead of a European Central Bank meeting that was expected to sharpen its anti-inflation line.

Early losses of around $3 a barrel in crude oil were pared back on reports of continued fighting in Libya, including air strikes against rebel positions.

Brent crude oil fell as low as $113.09 a barrel but was later back up around $116.

World stocks as measured by MSCI were up 0.2 percent.

The early moves in oil were prompted by Chavez, a good friend of Libyan leader Muammar Gaddafi, suggesting a commission from Latin America, Europe and the Middle East could be formed to try to reach a negotiated outcome to the Libyan crisis, which has driven oil prices to levels that may threaten global economic recovery.

Arab League Secretary-General Amr Moussa said the proposal a was under consideration by his group.

Some oil analysts suggested that the proposal was a convenient excuse for traders to adjust their positions.

“If it’s coming out of Chavez, it might not have a great degree of substance,” said Tim Riddell, head of technical analysis at ANZ in Singapore.

“The fact that the markets have been so volatile and without having concrete evidence of any material shift in the unrest in the Arab world suggests to me that we are at best consolidating.”

Financial markets have nonetheless become highly sensitive to North Africa and Middle east tension because of the broad impact that a rising oil price has on everything from corporate profits to consumer confidence and interest rate projections.

STOCKS RISE

European shares rose on Thursday buoyed by positive U.S. economic news overnight and the falling oil price.

The FTSEurofirst 300 index of leading European shares was up 0.4 percent, partially recovering the previous session’s 0.7 percent fall.

Forecast-beating U.S. private sector jobs data and positive comments from the Federal Reserve in its latest Beige Book report overnight helped buoy equities in both the United States and Asia.

“(There is) some hope that the global recovery is strong enough to weather any shocks that may arise due to uncertainties in the Middle East,” said Zahid Mahmood, senior dealer at Capital Spreads.

The euro hovered near a four-month high against the dollar, supported by expectations that the ECB meeting will pave the way for rate rises later in the year.

Investors have pushed the euro up about 3 percent from a low hit on February 14.

The euro was slightly weaker against the dollar at $1.3851, but close to its four-month peak of $1.3890 hit on trading platform EBS on Wednesday.

Euro zone government bonds traded lower ahead of the ECB meeting.

(Additional reporting by Neal Armstrong and Simon Falush; Editing by Hugh Lawson)

NEW YORK – The New York Times is reporting that market operators Nasdaq OMX and InterContinental Exchange are discussing forming a partnership to bid for NYSE Euronext.

The Times cited a person briefed on the matter. That unnamed person told the Times that an offer may not emerge for several weeks. The person also cautioned that there is a low probability of a bid. Representatives from Nasdaq OMX Group Inc. and InterContinental Exchange Inc. didn’t immediately respond to messages seeking comment.

Deutsche Boerse, the owner of the Frankfurt stock exchange, said on Tuesday that it will buy NYSE Euronext Inc., the parent of the New York Stock Exchange in a deal that values it at $10 billion.

A Deutsche Boerse-NYSE combination would put pressure on other exchange operators to grow to compete.

NEW YORK (Reuters) – Stocks rose on Monday as a weak dollar and expectations of economic stimulus from the Federal Reserve prompted investors to pick up risker assets.

The lagging greenback set the tone early in the day after a weekend meeting of the Group of 20 stopped short of setting targets to reduce trade imbalances. The greenback slid broadly, while commodity prices climbed.

Equities and the dollar have developed a strong inverse relationship, and growing speculation the Fed will extend monetary easing at its next meeting in November has pressured the dollar while boosting equities.

In a research report, Goldman Sachs said the Federal Open Market Committee is almost certain to announce renewed monetary easing at its November 2-3 meeting.

Goldman analysts calculated the Fed may have to buy up to $4 trillion in assets to achieve desired growth and inflation targets. They forecast the Fed’s second round of quantitative easing will likely be worth $2 trillion.

“The quantitative easing talk has hurt the dollar, helped the equity market and created this risk-taking environment,” said Nick Kalivas, senior equity index analyst at MF Global in Chicago.

“It’s creating this idea it’s going to be positive for asset inflation, so equities should benefit from that. There’s a reluctance to sell the market in the face of that possibility in front of that meeting … “

The Dow Jones industrial average (.DJI) gained 71.18 points, or 0.64 percent, to 11,203.74. The Standard & Poor’s 500 Index (.SPX) rose 7.20 points, or 0.61 percent, to 1,190.28. The Nasdaq Composite Index (.IXIC) climbed 17.15 points, or 0.69 percent, to 2,496.54.

Resource shares led the way higher on the back of the rising commodity prices. Freeport-McMoRan Copper and Gold Inc (FCX.N) advanced 2.8 percent to $96.62, and the S&P materials sector (.GSPM) gained 2.1 percent.

Citigroup Inc (C.N) was up 2.4 percent at $4.21 after Goldman Sachs added the stock to its “conviction buy list,” saying the big bank faced limited mortgage loan repurchase risk compared with its peers.

In a light day for economic data, sales of previously owned U.S. homes rose more than expected in September, the National Association of Realtors said, helping equities extend gains.

(Editing by Jeffrey Benkoe)

WASHINGTON – President Barack Obama says he’s been frustrated over accusations he’s been too hard on Wall Street, saying his push for financial reform doesn’t amount to “being extremist or anti-business.”

Answering questions at a town hall forum sponsored by CNBC, Obama said he’s been amused about talk of “me beating up on Wall Street.”

The president said he believes “most folks on Main Street feel like they got beaten up,” a line that drew a hearty ovation from the audience gathered at the Newseum.

Obama also said “there’s a big chunk of the country that thinks I’ve been too soft on Wall Street. What I’ve tried to do is be practical.”