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New York - Wall St. Plunges; Nasdaq At Lowest Since August

Published on: January 15, 2016 10:23 AM
By: Reuters 
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Traders work on the main trading floor of the New York Stock Exchange shortly after the opening bell of the trading session in New York January 15, 2016. ReutersTraders work on the main trading floor of the New York Stock Exchange shortly after the opening bell of the trading session in New York January 15, 2016. Reuters

New York -  Wall Street sank on Friday morning, with the Nasdaq hitting its lowest since Aug. 24 and the Dow plunging nearly 400 points, as oil prices dived below $30 per barrel.

The sell-off was broad, with all 10 major S&P sectors in the red and all 30 Dow components lower. The beaten-down energy sector’s 3.1 percent slide led the declines.

Brent crude prices, which have fallen 20 percent this year, were down nearly 5 percent as the market braced for oil from Iran to flood an already oversupplied market.

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World stocks were set for a third straight week of losses.

“Oil is deeply oversold. The stock market is deeply oversold. The inability for the market to rally from deeply oversold conditions clearly tells you how weak the market is,” said Adam Sarhan, chief executive of Sarhan Capital in New York.

Oil prices flirting with 12 year lows and the Federal Reserve tightening policy is “a one-two punch that the stock market just can’t handle,” Sarhan said.

U.S stocks have been in a steep selloff since the start of the year amid concerns about a slowdown in China and global growth. But, a rebound in oil prices fueled a rally on Thursday.

At 9:33 a.m. ET (1433 GMT) on Friday, the Dow Jones industrial average was down 358.99 points, or 2.19 percent, at 16,020.06.

The S&P 500 was down 38.11 points, or 1.98 percent, at 1,883.73.

The Nasdaq Composite index was down 133.36 points, or 2.89 percent, at 4,481.64. It hit a low of 4,463.458, the lowest level since the market plunge on Aug. 24 when China devalued the yuan.

Dow components Exxon and Chevron were down 3-4.5 percent, while Caterpillar dropped nearly 4.5 percent.

But the biggest drop was in Intel, tumbling 8.8 percent to $29.87 as concerns about the chipmaker’s slowing data center revenue growth overshadowed a quarterly profit beat.

Apple was down 3 percent and was the biggest drag on the S&P and the Nasdaq, while Goldman Sachs’ 3 percent fall weighed the most on the Dow.

Citigroup was down 5 percent at $43.03, while Wells Fargo fell 3.8 percent to $48.65, after reporting largely in-line quarterly earnings.

Investors are bracing for weak earnings reports with companies hit by plunging oil prices, concerns over China’s economy and a global economic slowdown.

Data on Friday showed an unexpected 0.1 percent fall in U.S. retail sales in December as unseasonably warm weather hurt sales of winter apparel.

U.S. industrial output fell for the third straight month in December, underscoring a worsening outlook for fourth-quarter economic growth.

The University of Michigan’s preliminary consumer sentiment index, due at 9:55 a.m., is expected to rise in January.

Fed policymakers have hinted at slowing the rate hike program should the economy not show signs of stability.

New York Fed President William Dudley said on Friday that lower oil prices and a stronger dollar have raised the risk of U.S. inflation expectations heading lower, hurting chances of actual inflation reaching the central bank’s 2 percent goal.

Declining issues outnumbered advancing ones on the NYSE by 1,756 to 166. On the Nasdaq, 2,204 issues fell and 194 advanced.

The S&P 500 index showed no new 52-week highs and 42 new lows, while the Nasdaq recorded two new highs and 208 new lows.



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Read Comments (1)  —  Post Yours »

1

 Jan 15, 2016 at 10:50 AM Anonymous Says:

Lets blame it all on the muslim in the white house!

It has nothing to do with a simple market correction or China. And the jobless rate is just terrible. Unemployment at 5% wow.

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