Stocks waver as Ireland debt fears remain a focus

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NEW YORK (AP) — Stock markets steadied themselves Wednesday after four days of declines as Ireland discussed a bailout with the European Union and Britain pledged support to help the struggling country.

The Dow Jones industrial average fell about 1 point in late morning trading, a day after the index posted its biggest loss since Aug. 11. Broader indexes rose slightly as energy and materials stocks rebounded and commodity prices edged higher.

A tame inflation report and another weak reading on the housing market did little to draw attention back to the domestic economy. Shares of homebuilders including D.R. Horton Inc. and PulteGroup Inc. fell about 1 percent after the disappointing housing report came out.

Stock markets around the world have been rattled over the past week out of fear that Ireland will become the latest European country to need a bailout. Greece was bailed out in May after it was unable to contain runaway spending. Ireland is now struggling after a collapse in its housing market forced the country to take over three large banks.

“They’re going to backstop (Ireland) one way or another,” said Larry Rosenthal, president of Financial Planning Services in Manassas, Va.

Britain, which is not part of the 16-nation bloc that uses the euro, on Wednesday offered to provide additional support to Ireland above and beyond any help it gets from the European Union or International Monetary Fund. That helped steady markets in Europe.

British banks would be among the hardest hit by an Irish debt default because they are among the largest holders of Irish bonds. Shares of HSBC and Barclay’s edged higher Wednesday.

Investors are concerned that a failure in Ireland could be just another step in a string of bailouts needed to help governments throughout Europe. Traders are also worried about big government debts in Portugal, Spain and Italy.

The euro rose slightly against the dollar Wednesday, but remains near its lowest level since late September.

The Dow fell 1.06, or less than 0.1 percent, to 11,022.14 in late morning trading.

The Standard & Poor’s 500 index rose 3.80, or 0.3 percent, to 1,182.14. The Nasdaq composite index rose 14.31, or 0.6 percent, to 2,484.15.

Britain’s FTSE 100 rose 0.3 percent after falling earlier in the day. Germany’s DAX gained 0.6 percent, while France’s CAC-40 rose 0.9 percent.

Bond prices rose slightly. The yield on the 10-year Treasury note, which moves opposite its price, fell to 2.82 percent from 2.85 percent late Tuesday. Its yield is used as a benchmark for interest rates on mortgages and other consumer and corporate loans.