While you were sleeping: Worries as euro hits four-month low

BUSINESSDESK: Wall Street struggled after Greece called for a new election after a failure to form a government, even as American data provided good news on the US economy.

The euro sank to a four-month low against the greenback.

While the date for the next Greek vote hasn't been announced, it appears likely to take place early next month.

It appears the leftist Syriza party, which is vehemently opposed to the terms of EU/IMF bailout, would win the largest number of seats.

Europe's Stoxx 600 Index closed with a 0.7% drop for the day, while the euro shed 0.7% to $US1.2739 at 2.19pm New York time.

"The Greeks and Germans seem to be playing an enormous game of chicken. It is unsettling to the market that those who would rather renegotiate the existing agreement seem to be gaining strength after the election," John Manley, chief equity strategist at Wells Fargo Funds Management in New York, told Reuters.

In late trading in New York, losses were accelerating. The Dow Jones Industrial Average fell 0.65%, the Standard & Poor's shed 0.54% and the Nasdaq Composite Index dropped 0.3%.

Economic data provided reason to remain optimistic. US retail sales eked out a 0.1% advance in April, the smallest increase since December, though the data also provided signs of strength.

In addition, the New York Federal Reserve's Empire State general business conditions index climbed to 17.09 in May, about double economists' expectations, while the National Association of Home Builders/Wells Fargo Housing Market index rose to a five-year high of 29 this month.

“The US economic data suggest growth is on track,” Alan Gayle, a senior strategist at RidgeWorth Capital Management in Richmond, Virginia, told Bloomberg News.

“Yet events affecting the health of the European financial markets can still have an impact on global growth. The politics in Greece is very frustrating for the market.”

Among other bright spots in the US market was Facebook, which increased the price range on its initial public offering.

That might value the company at more than $US100 billion.

The company lifted the target range to between $US34 and $US38 per share because of strong demand, from $US28 to $US35, according to a filing with the US Securities and Exchange Commission later today.

Final pricing is expected tomorrow, with trading set to begin on Friday.

The timing of Facebook's offering, with markets pulling back, makes some market watchers wary, including Bruce McCain, chief investment strategist at the private-banking unit of KeyCorp in Cleveland.

“They [Facebook] get more money upfront if they can make it go. But if the enthusiasm is weak out of the gate, it makes it that much more difficult for the company going forward,” Mr McCain told Bloomberg.

“You would think they would be a little more cautious.”

Amazon shares rose after Credit Suisse upgraded the stock to "outperform" and raised its price target to $US270 from $US190.

Home Depot shares dropped 2% after the home-improvement retailer predicted sales this year will slow from the first quarter.