Stocks fall following Cyprus bailout plan

Traders work on the floor of the New Traders work on the floor of the New York Stock Exchange Friday. Stocks around the world fell sharply March 18 as investors gave their initial verdict to a weekend plan to tax depositors in Cypriot banks as part of a bailout of the Mediterranean island nation (March 15, 2013) Photo Credit: AP

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Stocks closed lower on Wall Street as investors worried that a controversial proposal to seize money from depositors in Cyprus could set off another bout of anxiety over Europe's shared currency.

The Dow Jones industrial average fell 62.05 points to 14,452.06 Monday. It had plunged as much as 110 points in the early going, briefly turned positive in the afternoon then fell back again in the last hour of trading.

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The Standard & Poor's 500 index fell 0.55 percent to 1,552.10. The Nasdaq composite index fell 0.35 percent to 3,237.59.

European markets recovered most of an early slide and closed with modest losses. Yields on government bonds issued by Spain and Italy edged higher, and the euro fell to a three-month low against the dollar.

The market rally that has pushed the Dow to record levels this year has been punctuated by concerns about the euro-region's lingering debt crisis. The Dow fell 1.6 percent Feb. 25, its biggest wobble this year, after elections in Italy threw the country into political paralysis, endangering crucial economic reforms.

"Europe has got problems," said Uri Landesman, president of Platinum Partners, a hedge fund. "You could get more stuff like this, and the market isn't priced to handle that."

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