MARKET SNAPSHOT: U.S. Stocks Pull Back As Oil Drop Hits Energy Shares
March 14 2017 - 9:11AM
Dow Jones News
By Barbara Kollmeyer and Anora Mahmudova, MarketWatch
Airline shares hit amid flight cancellation due to East Coast
blizzard
U.S. stocks traded modestly lower on Tuesday as a persistent
slump in oil prices put pressure on energy shares. Investors were
also making guarded moves ahead of the start of the two-day Federal
Open Market Committee meeting.
Meanwhile, a blizzard bearing down on New York City threatened
to cut into trading volumes, with thousands of flights already
canceled across parts of the East Coast and a state of emergency
declared
(http://www.marketwatch.com/story/new-york-city-under-state-of-emergency-with-life-threatening-blizzard-set-to-hit-2017-03-14)
for the city itself.
The S&P 500 index was down 9 points, or 0.4%, to 2,364, with
nearly all nine of the 11 main sectors trading lower. The energy
sector led the declines, down 1.6%, while materials shares fell
0.8%.
The Dow Jones Industrial Average declined 39 points, or 0.2% at
20,842, with Caterpillar Inc.(CAT) and Chevron Corp.(CVX) leading
losses, down 1.8% and 1.3% respectively.
The Nasdaq Composite Index shed 27 points, or 0.5%, to 5,848.
The main indexes are still only a few percentage points below their
all-time highs
But some analysts suggested the pullback in the stock market
hasn't finished yet.
"Short-term momentum remains weak and short-term oversold
conditions are not yet widespread enough to suggest a low is being
established," said Katie Stockton, chief technical strategist at
BTIG.
On the data front, the National Federation of Independent
Business reported early Tuesday that small-business owners'
optimism dipped
(http://www.marketwatch.com/story/small-business-sentiment-stays-strong-nfib-says-but-slips-in-february-2017-03-14)
in February, but stayed close to long-term highs. Separately,
producer prices
(http://www.marketwatch.com/story/us-wholesale-inflation-rises-again-in-february-ppi-shows-2017-03-14)
jumped in February by 0.3%, above consensus expectations of 0.1%,
bringing the year-over-year wholesale inflation to 2.2%. Higher
inflation is one of the reasons the Federal Reserve is intent in
raising interest rates.
The main event, the FOMC meeting, will begin later. The market
sees an 93% probability that the Fed will vote for an interest-rate
increase, according to data from the CME Group
(http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html).
The U.S. central bank's statement and new economic projections
won't be released until 2 p.m. Eastern on Wednesday, followed by a
news conference hosted by Fed Chairwoman Janet Yellen. The FOMC's
policy statement will be examined for signals about the timing and
pace of future interest-rate hikes.
Tuesday's blizzard isn't expected to delay the release of the
Fed's decision, as a similar storm didn't stop the central bank
from meeting in early 2016
(http://www.marketwatch.com/story/blizzard-likely-wont-delay-fed-from-raising-rates-2017-03-13).
Stocks to watch: Energy shares took a hit, following a drop in
oil prices. Marathon Oil Corp(MRO) was down nearly 4%. Shares of
Transocean Ltd.(RIG) fell 3.2%. The U.S. Oil Fund ETF (USO) opened
at 3 1/2-month low, falling for a seventh straight session.
Shares of Valeant Pharmaceuticals International Inc.(VRX.T)
tumbled 9.3% after Bill Ackman's Pershing Square Capital Management
said it has sold its 10% stake
(http://www.marketwatch.com/story/bill-ackman-sells-valeant-stake-to-step-down-from-board-2017-03-13)
in the company amid mounting losses. Ackman himself plans to step
down from the board.
Over 5,000 flights have been impacted by blizzard conditions on
the East Coast
(http://www.marketwatch.com/story/over-5000-flights-impacted-by-blizzard-conditions-in-new-york-boston-washington-dc-2017-03-14).
American Airlines Group Inc. (AAL), United Airlines (UAL) and Delta
Air Lines Inc. (DAL) have all issued travel alerts and began
waiving rebooking fees for flights. Shares of airliners was down
about 2%.
Yahoo Inc.(YHOO) released details of a $23 million golden
parachute
(http://www.marketwatch.com/story/yahoos-marissa-mayer-to-get-23-million-severance-package-2017-03-13)
for the planned exit of CEO Marissa Mayer after the company sells
its core assets to Verizon (VZ). Shares were marginally higher.
Shares of automation software group Synopsys Inc.(SNPS) fell
0.8% after news the company will enter the S&P 500
(http://www.marketwatch.com/story/synopsys-to-be-added-to-sp-500-2017-03-13)
after the open of trade on Thursday.
Other markets: Asian stock markets were mixed, while European
stocks were lower
(http://www.marketwatch.com/story/european-stocks-edge-back-after-4-session-win-streak-2017-03-14).
The pound tapped its lowest levels against the dollar since
earlier this year--
(http://www.marketwatch.com/story/uk-pound-slides-to-lowest-in-weeks-after-lawmakers-clear-a-path-for-brexit-2017-03-14)trading
around $1.2129 after British lawmakers on Monday passed a law that
will allow the Brexit process to begin. The pound also tumbled
against the yen and the euro . The dollar was 0.3% higher, while
the 10-year Treasury yield
(http://www.marketwatch.com/story/treasurys-flat-as-investors-await-fed-outcome-2017-03-14)
was flat at 2.61%.
Oil prices tumbled 1.7%, while gold prices were flat.
(END) Dow Jones Newswires
March 14, 2017 09:56 ET (13:56 GMT)
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