S&P 500 again slides into cor­rec­tion in ’18

Daily Southtown (Sunday) - - BUSINESS - By Alex Veiga

U.S. stocks closed lower af­ter a short­ened ses­sion Fri­day, bump­ing the bench­mark S&P 500 in­dex into a cor­rec­tion, or drop of 10 per­cent below its most re­cent all-time high in Septem­ber.

En­ergy com­pa­nies led the mar­ket slide as the price of U.S. crude oil tum­bled to its low­est level in more than a year, re­flect­ing wor­ries among traders that a slow­ing global econ­omy could hurt de­mand for oil.

“Oil is re­ally fall­ing sharply, con­tin­u­ing its down­ward de­scent, and that ap­pears to be giv­ing in­vestors a lot of con­cern that there’s slow­ing global growth,” said Jeff Kravetz, re­gional in­vest­ment di­rec­tor at U.S. Bank Pri­vate WealthMan­age­ment. “You have that, and then you have the re­cent sell-off in tech and in re­tail, and then throw on there trade ten­sions and ris­ing rates.”

Losses in tech­nol­ogy and in­ter­net com­pa­nies and banks out­weighed gains in health care and house­hold goods stocks. Sev­eral big re­tail­ers de­clined as in­vestors mon­i­tored Black Fri­day for signs of a strong hol­i­day shop­ping sea­son.

Trad­ing vol­ume was lighter than usual with the mar­ket­sopen­for only a half day af­ter the Thanks­giv­ing hol­i­day.

The S&P 500 in­dex fell 17.37 points, or 0.7 per­cent, to 2,632.56. The in­dex is now down 10.2 per­cent from its last all-time high set Sept. 20. The last time the in­dex en­tered a cor­rec­tion­was in Fe­bru­ary.

The lat­est cor­rec­tion comes as in­vestors worry that cor­po­rate prof­its, a key driver of stock mar­ket gains, could weaken next year.

“The mar­ket is re-pric­ing and try­ing to as­sess where we’re go­ing to be in the early part of 2019,” said Quincy Krosby, chief mar­ket strate­gist at Pru­den­tial Fi­nan­cial.

The Dow Jones In­dus­trial Av­er­age lost 178.74 points, or 0.7 per­cent, to 24,285.95. The Nas­daq com­pos­ite dropped 33.27 points, or 0.5 per­cent, to 6,938.98. The Rus­sell 2000 in­dex of smaller-com­pany stocks picked up 0.40 points, or 0.03 per­cent, to 1,488.68.

Crude oil prices fell for the sev­enth straight week on wor­ries that a slow­ing global econ­omy could hurt de­mand even as oil pro­duc­tion has been in­creas­ing.

The bench­mark U.S. crude con­tract slid 7.7 per­cent to set­tle at $50.42 per bar­rel in New York. That is the low­est since Oc­to­ber 2017. Brent crude, the in­ter­na­tional stan­dard, lost 6.1 per­cent to close at $58.80 per bar­rel in Lon­don.

Tesla fell 3.7 per­cent to $325.83 af­ter the elec­tric auto maker said it in­tends to cut prices for it­sModelX and Model S cars in China to make them more af­ford­able.

Traders had their eye on re­tail­ers as Black Fri­day, the tra­di­tional start to the cru­cial hol­i­day shop­ping sea­son, be­gan. Shares in L Brands, op­er­a­tor of Vic­to­ria’s Se­cret and Bath & Body Works, added 2 per­cent to $29.97. Other re­tail­ers put in­vestors in a sell­ing mood. Kohl’s fell 3.7 per­cent to $63.83, whileTar­get lost 2.8 per­cent to $67.35. Macy’s dropped 1.8 per­cent to $32.01.

RICHARD DREW/AP

Mar­ket watch­ers saw the S&P 500 in­dex drop 17.37 points to 2,632.56 Fri­day.

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