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Wall Street drops amid concerns over Europe

By msnbc.com news services

Wall Street stocks fell sharply Monday as Germany's finance minister dimmed hopes an upcoming summit would result in a breakthrough in Europe's debt crisis.

Optimism the euro zone was making progress in resolving its sovereign debt crisis has pushed the S&P 500 to the top of a two-month trading range but left it vulnerable to pullbacks. The index had risen for two straight weeks for the first time since July and recorded its best two-week performance since 2009.

"The past couple of weeks have been obviously a phenomenal little run-up. The problem is it's a delicate run-up," said Chris Hobart, chief executive of Hobart Financial Group in Charlotte, North Carolina.

German Finance Minister Wolfgang Schaeuble said European Union governments would adopt a five-point plan at the Brussels meeting on Oct. 23, but "we won't have a definitive solution this weekend," he added.

Schaeuble's comments also sent the euro lower against the dollar and weighed on financial stocks.

"What we are looking at today in the market is obviously a direct correlation to what is going on in Europe," said Hobart. "Everything seems to be going well with Europe for a while, and you get this little news and it reconfirms the fears that everybody has."

The Dow Jones industrial average closed the day with a loss of over 240 points.

Events in Europe overshadowed a $21 billion deal by Kinder Morgan Incto buy rival El Paso Corp, combining the two largest natural gas pipeline operators in North America in a huge bet on the fast-growing market for that fuel.

In its quarterly results, Wells Fargo missed Wall Street's earnings estimates by 1 cent a share as interest income fell below expectations.

Shares of Citigroup Inc edged down. The bank reported higher third-quarter earnings as it set aside less money to cover bad loans and recorded an accounting gain banks can take in turbulent markets.

Of the 45 companies in the S&P 500 that have reported earnings, 62 percent have beaten analyst expectations, according to Thomson Reuters data.

The Associated Press and Reuters contributed to this report.