Stocks, oil prices slip; pound down on eve of Brexit vote
new york — Stocks around the world are falling on Monday, and US indexes gave up modest early gains and turned lower, hurt by sharp drops for energy and financial companies.
The British pound is dropping after the UK prime minister postponed a vote on its departure from the European Union, and oil has resumed its sharp slide.
The S&P 500 index lost 47 points, or 1.8 per cent, to 2,585, as of 11 a.m. Eastern time. The Dow Jones industrial average fell 435 points, or 1.8 per cent, to 23,904, and the Nasdaq composite dropped 73, or 1.1 per cent, to 6,894.
US indexes have been lurching up and down since October, mostly down, and the S&P 500 plunged 4.6 per cent last week for its biggest loss in more than eight months, as investors felt the US and China are still nowhere close to ending their trade dispute.
Volatility has been high not only week to week but also minute to minute. The S&P 500 zoomed from a gain of 0.2 per cent to a loss of 1.8 per cent Monday morning.
British Prime Minister Theresa May postponed a vote on her deal for Britain to exit the European Union, which had been scheduled for Tuesday. She acknowledged that she would have lost the vote by a significant margin. The pound sank to $1.2517, down from $1.2751 late Friday. The FTSE 100 stock index fell 0.5 per cent.
China raised the pressure over the weekend on the United States and Canada following the detention of Huawei chief financial officer Meng Wanzhou. She is suspected of trying to evade US trade curbs on Iran, and she was detained while changing planes in Canada.
China summoned both the US and Canadian ambassadors to meetings over the weekend, where it protested the detention and called it “extremely egregious.”
Meng’s arrest has jolted the stock market, and investors fear it is adding to the tensions between the world’s two largest economies.
Benchmark US crude fell 98 cents, or 1.8 per cent, to $51.66 per barrel in New York. Brent crude, the international standard, lost 40 cents to $61.27 a barrel.
It’s a resumption of the steep decline for crude’s price that began in October. Last week, crude steadied after Opec and other major oil producers said they will reduce production by 1.2 million barrels a day starting from January. The cuts will last for six months.
Energy stocks in the S&P 500 fell 2.7 per cent for the largest loss among the 11 sectors that make up the index.