Wednesday, April 24, 2019
Home World Stocks waver as plunging oil prices pull energy stocks lower

Stocks waver as plunging oil prices pull energy stocks lower

NEW YORK – After two days of huge losses, U.S. stocks ended the day back where they started on Tuesday. Energy companies sank as crude oil plunged 7 percent, but technology and consumer-focused companies climbed.
U.S. crude oil fell at its lowest price since August 2017, and it has now fallen almost 40 percent since early October. Investors are worried that supplies continue to increase and that demand is slowing down as the global economy weakens. The plunge in oil prices has crushed energy company stocks in recent weeks.
Energy stocks including Exxon Mobile fell again on Tuesday, but some of those losses were offset by gains in Apple, Amazon, Microsoft and Boeing. Boeing raised its quarterly dividend and said it will buy another $ 20 billion of its own stock. Boeing has tumbled on worries that global trade has been hit hard.
The Federal Reserve is starting its last meeting of the year. Investors expect it to raise interest rates on Wednesday when the meeting concludes. That would be his fourth increase this year, and his ninth in three years. Investors are hoping the Fed is going to slow down in 2019 in light of recent signs that economic growth is slowing down.
Trading turbulent. Two days of widespread market declines had knocked out 1.004 points off the Dow Jones Industrial Average, and on Tuesday, investors could not find a reason to go higher. On the other hand they did not see another big decline, either.
There have not been any major developments in US-China trade talks, a major focus for markets since the beginning of this month. JJ Kinahan, chief markets strategist for TD Ameritrade, said that's left investors confused about the state of the trade dispute and reluctant to commit to stocks, while businesses are not spending.
"We do not know the rules of the game," he said. "People can not plan. When you can not plan, you're not anxious to buy stocks. "
The S & P 500 index inched up 0.22 points to 2.546.16, but is still trading at its lowest levels in 14 months. The Dow industrials added 82.66 points, or 0.4 percent, to 23.675.64. The Nasdaq composite gained 30.18 points, or 0.4 percent, to 6,783.91.
The Russell 2000 index of smaller companies lost another 0.97 points, or 0.1 percent, to 1.377.18. The index is 21 percent below the peak it set in August, meaning it's in Wall Street a "bear market."
Benchmark U.S. crude plunged 7.3 percent to $ 46.24 a barrel in New York. Brent crude, declined 5.6 percent to $ 56.26 a barrel in London.
The twin fears of slower global economic growth and rising stockpiles are bad for crude prices. While OPEC and several other countries recently agreed to cut production of oil in 2019, that has not stemmed the decline in prices. Traders have the cut is large enough to balance supply and demand.
"They're not the only game in town anymore," Kinahan said of OPEC. He said rising oil production in the U.S. OPEC's ability to sway the oil market.
On Tuesday, the Energy Information Administration said. Shale oil production will keep climbing in January, and the Wall Street Journal reported that oil production in Russia reached a record high in December.
The Federal Reserve has recently announced three more increases in interest rates next year, but investors doubt that's going to happen. The Fed's rates help set borrowing costs for various types of loans. Higher rates may have slow economic growth, and that's something investors have been worrying about as China and Europe have suggested growth is slowing, and the U.S. economy is so expected to be cool off in 2019.
Those higher rates make them look less attractive.
After the increase in its dividend and the larger stock repurchase, Boeing climbed 3.8 percent to $ 328.06. The stock has dropped 16 percent since early October. Johnson & Johnson and insurer Allstate.
The Commerce Department said developers broke ground on more apartments in November, and homebuilders climbed. Lennar gained 2.5 percent to $ 41.01 and NVR added 1.1 percent to $ 2,479.81. The companies have taken huge losses this year as rising mortgage rates and reduced home sales.
Real Estate Investment Trusts So Rose Tuesday. Apartment building owner AvalonBay communities gained 1.1 percent to $ 181.91 and CBRE rose 4.3 percent to $ 41.15. Real estate companies had taken sharp losses Monday.
Bond prices rose again. The yield on the 10-year Treasury dipped to 2.82 percent from 2.85 percent late Monday.
Germany's DAX lost 0.3 percent, deepening its slide into a bear market. Britain's FTSE 100 shed 1.1 percent and France's CAC 40 dripped 1 percent lower.
Losses were more severe in Asia. The Nikkei 225 in Japan lost 1.8 percent, the Hang Seng in Hong Kong dropped 1 percent and South Korea's Kospi slipped 0.4 percent.
In other commodities trading, wholesale gasoline fell 4.2 percent to $ 1.35 a gallon and heating oil lost 4 percent to $ 1.75 a gallon. Natural gas jumped 8.8 percent to $ 3.84 per 1,000 cubic feet.
Gold inched up 0.1 percent to $ 1,253.30 an ounce. Silver fell 0.4 percent to $ 1470 an ounce. Copper skidded 3.3 percent to $ 2.66 a pound.
The dollar dipped to 112.53 Japanese yen from 112.75 yen late Monday. The euro rose to $ 1.1357 from $ 1.1350, and the British rose to $ 1.2639 from $ 1.2629.
Markets writer Stan Choe added to this report from New York.
AP Markets Writer Marley Jay can be reached at
Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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