NEW YORK: Wall Street was lower on Wednesday morning, as energy stocks took a hit from a slide in oil prices after Saudi Arabia ruled out a cut in output to help tackle a global glut.
Stocks have closely tracked oil prices this year as investors fret about the health of the global economy. The S&P 500 is down 6% for the year, while the Nasdaq composite has shed more than 10%.
US crude was down nearly 4%, also pressured by data showing an increase in stockpiles. Shares of Chevron were down 2%, while Exxon fell 1.9%.
“There is very little good news for the market to hang its hat on,” said John Brady, managing director at brokerage R.J. O’Brien & Associates in Chicago.
“Unless something happens, my sense is that we’re going to continue to break down here a little bit,” he said.
At 9:39am ET (1439 GMT), the Dow Jones industrial average was down 184.22 points, or 1.12%, at 16,247.56.
The S&P 500 was down 22.26 points, or 1.16%, at 1,899.01 and the Nasdaq Composite index was down 58.81 points, or 1.31%, at 4,444.77.
Nine of the 10 major S&P sectors were lower, led by the 1.94% decline in energy.
Investors will also analyse comments from US Federal Reserve policymakers for clues on the central bank’s view on the state of the economy ahead of its meeting next month.
While Fed chair Janet Yellen has hinted that the central bank is likely to stick to its plan to raise rates gradually this year, other policymakers have expressed caution about pressing ahead amid the turbulence in global markets.
Economic data due on Wednesday includes a report on new home sales, which are expected to have fallen 4.4% in January.
The data is due at 10am ET (1500 GMT).
Boeing was down 2.3% at US$114.34 after Goldman Sachs cut its price target on the stock.
JP Morgan was down 2.3% at US$54.81 after it said it would set aside another US$500mil in provisions for expected losses on energy loans and that its investment banking revenue was falling.
Lowe’s was down 3.7% at US$66.15 despite the home improvement chain’s better-than-expected results.
Avis slumped 16.4% to US$25.05 after the car rental company’s profit missed estimates.
Declining issues outnumbered advancing ones on the NYSE by 2,353 to 360. On the Nasdaq, 1,844 issues fell and 388 advanced.
The S&P 500 index showed three new 52-week highs and two lows, while the Nasdaq recorded two new highs and 45 lows. - Reuters
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