Energy leads modest slide in U.S. stocks
Energy companies led U.S. stocks modestly lower, erasing the small gains the market made a day earlier.
Energy companies led U.S. stocks modestly lower Tuesday, erasing the small gains the market made a day earlier.
The biggest drop in crude oil prices since October weighed on oil producers and other energy stocks. Disappointing results or outlooks from retailers and other companies also weighed on the market.
Utilities and consumer-focused companies like packaged food and beverage makers, restaurant chains, bucked the trend.
Investors had their eye on Washington D.C., where the House is expected to vote on its version of a major tax bill this week.
Expectations that the tax overhaul will sharply lower corporate taxes have helped lift the market higher this year.
“We’re through earnings season, which was pretty good, with earnings up about 10 percent,” said Stuart Freeman, co-head of global equity strategy for Wells Fargo Investment Institute. “Now investors are waiting and watching to see what shape this tax reduction bill is going to take.”
The Standard & Poor’s 500 index fell 5.97 points, or 0.2 percent, to 2,578.87. The Dow Jones industrial average lost 30.23 points, or 0.1 percent, to 23,409.47. The Nasdaq composite slid 19.72 points, or 0.3 percent, to 6,737.87. The Russell 2000 index of smaller-company stocks gave up 3.81 points, or 0.3 percent, to 1,471.26.
The steep drop in crude oil prices weighed on oil exploration companies and other energy sector stocks.
Newfield Exploration was the biggest decliner in the S&P 500, tumbling $2.27, or 7.1 percent, to $29.82. Range Resources lost $1.23, or 6.6 percent, to $17.35.
Benchmark U.S. crude fell $1.06, or 1.9 percent, to settle at $55.70 per barrel on the New York Mercantile Exchange. That’s the biggest single-day decline since October. Brent crude, used to price international oils, declined 95 cents, or 1.5 percent, to close at $62.21 a barrel in London.
“There’s this perception that there’s a lot of supply waiting in the wings and as prices have moved higher that’s made the marginal producer want to come out and just find more oil,” said Eric Freedman, chief investment officer of U.S. Bank Wealth Management.
The market’s spotlight is on retailers this week, with many of the companies reporting quarterly results over the next few days, including Target Corp., Wal-Mart Stores and Best Buy.
On Tuesday, Home Depot turned in better-than-expected results and raised its outlook for the year. Shares in the home-improvement retailer rose $2.71, or 1.6 percent, to $168.06.
Advance Auto Parts vaulted 16.3 percent after the company’s latest quarterly earnings exceeded Wall Street’s expectations.
Trader Gregory Rowe, left, and specialist John McNierney work at the post that handles General Electric on the floor of the New York Stock Exchange, Tuesday. Stocks are opening lower on Wall Street as technology companies, banks and retailers sink.