US stock mkts finish volatile week sharply lower on falling oil prices

In this file photo, a motorist in Leonia, NJ, fills up his car as the price of unleaded regular fell below $2 a gallon. Motorists around the world have benefited from low oil prices all year. As the year draws to an end, the price of benchmark US crude oil was trading at near seven-year lows below $35 a barrel, with prices weighed down by the slowdown in China and high supply from producers like the OPEC oil cartel and the US. Oil prices have helped shore up consumer

spending in many regions and kept a lid on inflation. (AP) NEW YORK, Dec 19, (AFP): The Dow dropped more than two percent Friday as US stocks finished a volatile week sharply lower due in part to worries about falling oil prices.

The Dow Jones Industrial Average tumbled 367.29 points (2.10 percent) to 17,128.55.

The broad-based S&P 500 fell 36.34 (1.78 percent) to 2,005.55, while the tech-rich Nasdaq Composite Index lost 79.47 (1.59 percent) at 4,923.08.

Friday’s rout pushed all three indices into the red for the week.

Oil prices fell to fresh multi-year lows as a continued supply glut weighs on the commodity and petroleum-linked stocks.

Analysts said Wednesday’s monumental decision to lift US interest rates for the first time in nearly a decade has also spurred greater volatility, resulting in big rallies on Tuesday and Wednesday that were reversed the subsequent two days.

“Overall, the market is still trying to digest of two things,” said David Levy, portfolio manager at Kenjol Capital Management. “We still have in mind the price of oil as well as the long-term ramifications of what the Federal Reserve is trying to do.”

Analysts said technical factors exacerbated Friday’s losses. Friday was the so-called “quadruple witching” deadline when many futures and options contracts expire.

Big companies including Apple, Boeing, Procter & Gamble and Microsoft all lost between 2.7 percent and 4.1 percent.

Disney fell 3.8 percent despite setting a record $57 million in opening-night ticket sales for its blockbuster “Star Wars: The Force Awakens.” BTIG downgraded the stock, saying the strong performance of the movie will not be enough to offset weakness in Disney’s ESPN division.

Transocean slumped 5.7 percent after announcing that Statoil will terminate an ultra-deepwater drillship contract about five months early.

Some other oil-services companies also suffered deep declines. Nabors Industries lost 6.3 percent and Weatherford International 8.5 percent.

BlackBerry jumped 10.4 percent after reporting a net loss of $89 million in the third quarter, besting analyst forecasts for a much deeper loss. 24/7 Wall Street said it was encouraged by a big rise in software and services revenue.

CarMax tumbled 6.4 percent as net income for the third quarter slipped 1.4 percent behind a 0.8 percent drop in comparable store unit sales due to lower traffic at its used-car lots. Results were also affected by higher advertising expenses.

A slew of US and Japanese data to be released in the coming days will be key trading cues for Tokyo investors after both countries’ central banks rolled out fresh policy moves this week.

On Friday, the Bank of Japan (BoJ) announced surprise tweaks to its huge stimulus plan, jolting financial markets and pushing the yen into a brief dive, as Japan’s economy struggles to mount a recovery.

The decision came days after the Federal Reserve hiked interest rates for the first time in almost a decade on the back of a firm US economy.

The moves highlighted a growing divergence in monetary policy between the US central bank and its overseas counterparts.

Next week, investors will be keeping an eye on some key US data, including economic growth figures and existing US homes sales, after the Fed rate move boosted hopes the world’s top economy was back on track.

“Investors are keen to confirm the health of the US housing market,” Nomura Securities said in a commentary.

In Japan, markets will be looking at inflation, jobs and spending data later in the week after the BoJ tweaked its massive stimulus plan Friday.

Among the moves, the bank said it would boost its holdings in firms dedicated to capital spending and new hiring.

They also made some other tweaks — including hiking the bank’s exposure to longer-term bonds — after wrapping up their last policy meeting of the year.

The announcement comes as analysts raise concerns the BoJ would struggle to scoop up enough bonds under its 80 trillion yen ($654 billion) annual asset-buying scheme — which effectively prints money to spur lending.

BoJ chief Haruhiko Kuroda said that the measures announced Friday were designed to beef up the impact of the bank’s monetary easing on the economy.

The benchmark Nikkei 225 index briefly rallied more than two percent — it was in negative territory during morning trade — as the yen sharply weakened, boosting exporters.

But the jump quickly faded and the Nikkei fell 1.90 percent, or 366.76 points, to close at 18,986.80. It lost 1.27 percent over the week.

The broader Topix index of all first-section shares dropped 1.76 percent, or 27.61 points, to 1,537.10. It was down 0.80 percent this week.

“Investors thought that the impact of the (BoJ) measures was likely to be limited,” IwaiCosmo Securities broker Toshikazu Horiuchi told AFP.

“But at least it’s true that the Bank of Japan still intends to sustain the economy with abundant cash, which marks a sharp contrast to the Fed.”

Tokyo’s losses tracked a sharp decline on Wall Street as the rout in oil prices pummels petroleum-linked equities again, with JX Holdings down 3.74 percent at 491.3 yen and Inpex losing 2.6 percent to 1,141 yen.

Toyota fell 0.58 percent to 7,658 yen, Nissan dropped 1.64 percent to 1,257 yen and Sony sank 2.58 percent to 2,998.5 yen.

On currency markets, the dollar weakened to 121.83 yen from 122.60 yen in New York on Thursday. It had jumped over 123 yen right after the BoJ announcement.