Stock rally fades; oil prices keep sink­ing

Richmond Times-Dispatch - - MONEY & MARKETS -

NEW YORK — Stocks in the U.S. slipped Thurs­day as the ninth con­sec­u­tive drop in crude oil prices hurt en­ergy com­pa­nies. U.S. mar­kets were com­ing off huge gains the day be­fore.

U.S. crude oil has now slumped more than 20 per­cent since early Oc­to­ber, meet­ing Wall Street’s def­i­ni­tion of a “bear mar­ket.”

Gov­ern­ment fuel stock­piles have steadily ex­panded, push­ing sup­plies higher, and the U.S. is­sued waivers to a num­ber of coun­tries that buy oil from Iran. That al­lows those coun­tries to keep im­port­ing Ira­nian oil in spite of re­newed sanc­tions on that coun­try.

Most other groups of stocks fin­ished lit­tle changed. Banks made the largest gains. The Fed­eral Re­serve left in­ter­est rates where they are but sug­gested it plans to keep rais­ing rates in re­sponse to the strong econ­omy.

Af­ter its steep plunge in Oc­to­ber, the S&P had risen for six of the seven days end­ing on Wed­nes­day. Stocks started sink­ing last month be­cause in­vestors wor­ried that the Fed was go­ing to raise in­ter­est rates to the point they slowed down eco­nomic growth. But John Lynch, chief in­vest­ment strate­gist at LPL Re­search, said he doesn’t think that’s go­ing to hap­pen and that the Fed will stop rais­ing rates in 2019.

“We do not be­lieve they will be as ag­gres­sive as many fear,” he said. “We still don’t have any­thing ap­proach­ing the wage pres­sures that have his­tor­i­cally scared the Fed.”

The S&P 500 in­dex shed 7.06 points, or 0.3 per­cent, to 2,806.83 af­ter it jumped 2.1 per­cent Wed­nes­day. The Dow Jones In­dus­trial Av­er­age inched up 10.92 points to 26,191.22. The Nas­daq com­pos­ite dipped 39.87 points, or 0.5 per­cent, to 7,530.88 af­ter a 2.6 per­cent surge a day ear­lier.

Bench­mark U.S. crude oil fell 1.6 per­cent to $60.67 a bar­rel in New York. On Oct. 3 it closed at $76.41, the high­est level in al­most four years.

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