YAHOO [BRIEFING.COM]: U.S. equity markets opened the session sharply lower on renewed European worries. International Monetary Fund officials voiced concerns over Greece being able to continue servicing its debt. In addition, Spain instated a three-month short selling ban on all stocks, while Italy did the same for financial and insurance firms. Despite the early selling pressure and flight to safety, markets recovered more than half of their losses, as sellers lacked a catalyst to push stocks to new lows.

European financials were under severe pressure this morning as sellers attacked the complex on renewed sovereign debt concerns. Traders continued to watch peripheral yields as both the Italian and Spanish 10-yr yields surged to 6.317% and 7.431% respectively. Deutsche Bank (DB 28.76, -1.29) and Barclays (BCS 9.58, -0.33) saw heavy losses of 4.3% and 3.3% respectively.

The ability for U.S. equities to see some safe-haven buying may very well rest on the performance of companies over the next few weeks. Restaurants continued to record poor performances with industry bellwether McDonalds (MCD 88.94, -2.64) missing expectations as headwinds from overseas and on rising costs of food products weighed on results. Industrial goods producer Eaton (ETN 40.57, +1.51) beat on the bottom line but failed to match revenue expectations. Elsewhere, Oil services giant Halliburton (HAL 31.51, +0.74) was one of the few bright spots as it beat on bottom and top line expectations.

The consumer discretionary sector was down 1.3%. Toy maker Hasbro (HAS 35.19, +1.35) bucked the trend today after reporting better than expected second quarter earnings. On the other hand, women's clothing retailer Wet Seal (WTSLA 2.66, -0.30) was lower after the company terminated its Chief Executive Officer and lowered second quarter guidance.

Nexen (NXY 25.90, +8.84) was up 51.8% after announcing it will be acquired by Chinese energy giant CNOOC (CEO 193.96, -8.79) for $27.50 per share in cash. The deal values Nexen at approximately $15.1 billion while keeping the total debt burden of the company at $4.3 billion. Canada’s Industry Minister has recently confirmed the deal is under foreign investment review.

GNC Holdings (GNC 37.40, -0.25) was down 0.6% after announcing the Board of Directors elected Chief Executive Officer Joseph Fortunato to replace Norman Axelrod as Chairperson of the Board. The stock opened on session lows, touching $35.50 before buyers emerged at near support dating back to the middle of June.  

Thirty-eight companies are scheduled to report earnings after hours. Texas Instruments (TXN 26.82, -0.43) will be in focus, as technology stocks have been underperforming early in the earnings season. In addition, Steel Dynamics (STLD 12.22, -0.20) may provide a glimpse into the health of the construction and durable goods sectors.

Second quarter earnings continue to flow this week with notables Baidu.com (BIDU 107.10, -3.13), Altria (MO 35.49, -0.42), Apple (AAPL 603.83, -0.47), and Ford Motor Company (F 9.17, -0.04) all scheduled to release their latest quarterly results.

Treasuries saw steady selling over the course of the session after the early morning flight to safety dropped yields into record territory. Early buying saw the benchmark 10-yr yield hit an all-time low of 1.395% before selling ran it back up to its current 1.438%. A flatter yield curve has the 2-10-yr spread trading tighter at 121.5 bps.

Crude oil struggled in negative territory for its entire pit session as the dollar strengthened in response to renewed European sovereign debt concerns. The energy component touched a session low of $87.94 per barrel in morning action and inched to a session high of $89.78 per barrel. However, a sell-off heading into the close left crude to settle with a 4.2% loss as it closed at $88.09 per barrel.

Despite opening pit trade in the red and brushing a session low of $2.99 per MMBtu moments later, natural gas was able to find buying support and pop into positive territory to a session high of $3.13 per MMBtu. After chopping around near the unchanged line in afternoon action, it settled at $3.12 per MMBtu, booking a gain of 1.3%. The stronger dollar also put pressure on precious metals.

Gold dipped to a floor session low of $1562.00 per ounce but was able to recover some losses as it traded up to a session high of $1579.70 per ounce and later settled with a 0.4% loss at $1577.10 per ounce.

Silver fell to a pit session low of $26.61 per ounce in morning action and trended higher for the remainder of its session to close at $27.02 per ounce, or 1.0% lower.

After opening the session at 20.41, the Volatility Index, or VIX, eased to 18.62, which was a 14.3% gain for the session.DJ30 -101.11 NASDAQ -35.15 SP500 -12.14 NASDAQ Adv/Vol/Dec 509/1.53 bln/1990 NYSE Adv/Vol/Dec 712/743.1 mln/2344