tue
APRIL 7, 2020 / 4:51 pm
Oil drop saps gains as Wall Street fades late
DJ: 22,679.99 +1,627.46 NAS: 7,913.24
+540.16 S&P: 2,663.68
+175.03 4/6
DJ: 22,653.86 -26.13 NAS: 7,887.26 -25.98 S&P: 2,659.41
-4.27 4/7
NEW YORK (Reuters) - Wall
Street fell on Tuesday, as a drop in oil prices steepened in the latter stages
of the session and erased early gains built on tentative signs that coronavirus
outbreaks in some of the biggest U.S. hot spots may be leveling. The S&P initially appeared poise to add
to a 7% jump on Monday, after health officials said the pandemic may kill fewer
Americans than indicated in recent projections. Governor Andrew Cuomo said New
York, the epicenter of the virus in the United States, was nearing a plateau in
the number of patients hospitalized.
“The market sees some hint of good news in terms of the virus. We know we’ve got the
Fed and a lot of stimulus, fiscal stimulus coming,” said Scott Wren, senior
global market strategist at Wells Fargo Investment Institute in St. Louis,
Missouri. Energy and materials were the best performing
sectors, with an aggressive round of U.S. fiscal and monetary stimulus in the
past month helping to boost risk appetite for the majority of the session.
Still, a decline in oil prices steepened, as U.S. crude settled down more than 9%
as supplies swell and investors tempered expectations for a quick agreement on
output cuts between major producers. Investors also braced for worsening
economic data and corporate earnings in the coming weeks. “Oil is important because about 20% of the high yield bond market is
energy. The energy sector has tens of thousands of high paying jobs and
there’s a lot of capital expenditure that happens in the sector too,” said
Wren.
The Dow Jones Industrial
Average fell 26.13 points, or 0.12%, to 22,653.86, the S&P 500 lost 4.27
points, or 0.16%, to 2,659.41 and the Nasdaq Composite dropped 25.98 points, or
0.33%, to 7,887.26. The S&P 500 is up 18.9% from its March 23 intraday low, but
remains 21.5% below its
mid-February record high as methods designed to contain the virus
quashed demand across a swath of industries such as airlines, automakers and
hotels.
Wall Street’s fear
gauge has steadily retreated from 12-year peaks in recent days, but
volatility is expected to remain elevated as companies prepare to report an
expected slide in first-quarter earnings and outline more drastic plans to
bolster cash reserves. Analysts now expect first-quarter earnings
for S&P 500 firms to
fall 6.4% compared to a Jan. 1 forecast for a rise of 6.3%.
Exxon Mobil throttled back a multi-year investment spree in
shale, LNG and deep water oil production, saying it would cut planned capital
spending this year by 30% as the pandemic saps energy demand. Oilfield services firm Halliburton Co said it
would cut about 350 jobs in Oklahoma and that its executives would reduce their
salaries. Exxon shares climbed 1.90% and
Halliburton rose 1.64%, helping the energy sector move higher even as crude
prices fell.
Advancing issues outnumbered declining ones on the NYSE by a
2.71-to-1 ratio; on Nasdaq, a 1.30-to-1 ratio favored advancers. The S&P 500 posted 4 new 52-week highs
and no new lows; the Nasdaq Composite recorded 9 new highs and 26 new lows.
Volume on U.S. exchanges
was 13.92 billion shares,
compared to the 15.42 billion average for the full session over the last 20
trading days.
No comments:
Post a Comment