FILE – In this Dec. 2, 2010 file photo, traders work on the floor of the New York Stock Exchange. (AP Photo/Richard Drew, file)
NEW YORK (AP) — Stocks fell modestly in early trading Monday after Federal Reserve Chairman Ben Bernanke said the economic recovery is still struggling to become “self-sustaining” without government help.
Bernanke, in a taped interview with CBS’ “60 Minutes” Sunday, argued that Congress shouldn’t cut spending or boost taxes given how fragile the economy remains. He also said it could take four or five more years for unemployment, now at 9.8 percent, to fall to a historically normal 5 percent or 6 percent.
That’s taking some juice out of the market’s recent rally.
In early trading, the Dow Jones industrial average fell 25.47, or 0.2 percent, to 11,356.62. The Standard Poor’s 500 index dropped 3.15, or 0.3 percent, to 1,221.56. The Nasdaq composite index fell 3.42, or 0.1 percent, to 2,588.02.
Last week, the Dow Jones industrial average rose 2.6 percent, its best weekly gain since hitting a 2010 high on Nov. 5. The Dow is still up 9 percent for the year.
But Bernanke’s comments did little to calm investors’ fears about the economy, which motivated traders to sell stocks.
“There’s going to be continued unease about the recovery,” said Oliver Pursche, president of Gary Goldberg Financial Services, an investment management firm.
Treasury prices rose as investors put money into less risky assets. The yield on the 10-year Treasury note, which moves opposite to its price, fell to 2.95 percent from 3.00 percent late Friday. Changing yields affect interest rates on a variety of business and consumer loans including mortgages.
Gold for February delivery rose $13.70, or about 1 percent, to $1,419.30 an ounce. Silver for March delivery gained 73 cents to $30.00 an ounce.
In U.S. corporate news, shares of Barnes Noble Inc. shot up $2.23, or 16.8 percent, to $15.51 after activist investor William Ackman and other shareholders of Borders Group Inc. said they were prepared to finance a $16 per share takeover bid for Barnes Noble. Shares of Borders rose 30 cents, or 27.8 percent, to $1.38.
Sprint Nextel Corp. jumped 22 cents, or 5.6 percent, to $4.15 after the company said it would start phasing out the Nextel part of its network in 2013. That decision follows near-constant subscriber losses since Sprint bought Nextel in 2005.
Pfizer Inc. rose 33 cents, or 1.9 percent, to $17.05 after the world’s biggest drugmaker abruptly replaced its CEO and chairman. The company said Jeffrey B. Kindler was retiring after 4 1/2 years to “recharge.”
No new economic data is set to be released Monday. The government will release data on consumer borrowing on Tuesday and a preliminary report on consumer sentiment from Thomson Reuters/University of Michigan is due out Friday.
Traders will also be focused on the European debt crisis throughout the week. Finance ministers from the 16-nation euro zone gathered on Monday to discuss ways to stabilize their currency union and avoid more expensive bailouts.
Britain’s FTSE 100 rose 0.5 percent, while Germany’s DAX and France’s CAC40 were unchanged.
Asian indexes closed mostly lower. Japan’s Nikkei 225 lost 0.1 percent, but China’s benchmark Shanghai Composite Index gained 0.5 percent.
The dollar rose 0.5 percent against an index of six other heavily traded currencies. The euro fell to $1.3274 from $1.3375 late Friday.