By Ryan Vlastelica
NEW YORK (Reuters) - U.S. stocks fell on Friday, with the Nasdaq set to break a seven-session streak of gains, amid ongoing uncertainty over negotiations for a debt deal in Greece.
In a positive sign, the new prime minister of Greece said he was certain that euro zone finance ministers would accept Athens' request for an extended loan, while Germany seemed to soften its tone after earlier this week rejecting Greece's proposal for a loan extension.
However, Maltese Finance Minister Edward Scicluna told the weekly Malta Today that the EU's biggest countries may be prepared to let Greece leave the euro zone.
The CBOE Volatility index rose 3.4 percent, but at 15.81, the so-called "fear index" remains below its long-term average around 20.
While U.S. equities have little direct exposure to Greece, a relatively small economy in the euro zone, Wall Street has risen recently on any sign of progress in reaching an accord. Investors are concerned that if no deal is reached, potentially forcing Greece out of the euro zone, that will lead to extended volatility with a major trading partner.
"We're not pricing in dramatic risk from Greece, but the fear is that if Greece leaves the euro zone, that would just be the first domino to fall in a catastrophe," said Tom Digenan, head of U.S. equities at UBS Global Asset Management in Chicago.
"Everyone is trying to avoid that, but from the German perspective, you don't want to give too much away and set a bad precedent."
Deere & Co fell 0.6 percent to $91.14 after the farm equipment maker reported a 43-percent drop in quarterly profit, hurt by a decline in sales.
Noodles & Co plunged 28 percent to $19.90 in heavy trading after the fast-casual restaurant chain operator's adjusted profit outlook was below expectations.
On the upside, Intuit Inc rose 5.5 percent to $96.16 a day after reporting a smaller-than-expected quarterly loss.
The Dow Jones industrial average fell 11.76 points, or 0.07 percent, to 17,974.01, the S&P 500 lost 3.28 points, or 0.16 percent, to 2,094.17 and the Nasdaq Composite added 2.17 points, or 0.04 percent, to 4,926.87.
For the week, the Dow is down 0.2 percent, the S&P 500 is down 0.1 percent and the Nasdaq up 0.7 percent. The Nasdaq has risen for seven straight sessions and is nearing its March 2000 all-time high, reached prior to the bursting of the dot-com bubble.
"The market isn't cheap, but we're cheap relative to other asset classes like Treasuries," said Digenan, who helps oversee about $6.5 billion. "We're at fair value, which implies returns of 7 or 8 percent, which is pretty strong, but don't expect to get that without risk."
Declining issues outnumbered advancing ones on the NYSE by 1,451 to 1,447, for a 1.00-to-1 ratio; on the Nasdaq, 1,444 issues fell and 1,052 advanced, a 1.37-to-1 ratio.
The S&P 500 was posting 28 new 52-week highs and 2 new lows; the Nasdaq Composite was recording 54 new highs and 11 new lows.
(Editing by Bernadette Baum and Nick Zieminski)
