U.S. stocks fluctuated, after halting a two-day slide, amid corporate earnings and as crude-oil rallied for a second day.
The Standard & Poor’s 500 Index lost less than 0.1 percent to 1,911 at 9:34 a.m. in New York, after rising for the first time in three days yesterday. West Texas Intermediate crude futures rose 3.7 percent, after erasing an earlier 1.9 percent drop.
U.S. stocks climbed yesterday, led by gains in energy and raw-materials, and fueled by a steep drop in the dollar, that halted the S&P 500’s two-day slide to start the month. Equities came off their worst January since 2009, with the benchmark 10 percent below its all-time high set in May, as concerns that a slowdown in China will spread and plummeting commodity prices unnerved investors.
Bank of England policy makers today left the benchmark interest rate at a record-low 0.5 percent as the nine-member panel voted unanimously for the first time since July. Officials cut their growth and inflation forecasts and signaled borrowing costs will stay low. Governor Carney said during a press conference that global financial conditions have deteriorated notably.
Investors are on guard for any signs China weakness is spilling over after economic data yesterday rekindled worries about the strength of U.S. growth. A report today showed the number of Americans filing applications for unemployment benefits rose last week, while the four-week average exceeded 280,000 for a third consecutive week, indicating the pace of firings has sped up a bit from historically low levels.
U.S. stocks sank, with the Standard & Poor’s 500 Index sliding back below the 1,900 level to erase Thursday’s rally, amid tumbling oil prices and after data showing falling retail sales.
Goldman Sachs Group Inc. fell 3.1 percent after agreeing to settle a U.S. probe into its handling of mortgage-backed securities, a move that will cut its fourth-quarter profit by about $ 1.5 billion. Citigroup Inc. and Wells Fargo & Co. lost at least 3.7 percent even after reporting quarterly earnings that topped projections. Wal-Mart Stores Inc. dropped 1.5 percent after saying it plans to close 269 stores.
Stock index futures extended declines earlier after reports showed retail sales decreased in December to cap the weakest year since 2009 and a Federal Reserve gauge of manufacturing in New York slumped. The S&P 500 lost 2 percent to 1,833.67 at 9:33 a.m. in New York, after gains yesterday in energy and health-care shares pushed the benchmark yesterday to its biggest rally in a month. The Dow Jones Industrial Average slid 383 points, or 2.3 percent, to 15,995.82.
Concern over China’s slowdown and deepening crude losses have dominated investor sentiment in 2016, prompting a 6 percent plunge in the S&P 500 year-to-date. Yesterday’s gains helped the benchmark almost erase its losses for the week. Today’s decline pushed the gauge to be poised for a third weekly drop, with oil falling back below $ 30 a barrel and the Shanghai Composite Index entering a bear market.
Corporate earnings may offer cues on the strength of the U.S. recovery, with seven S&P 500 companies posting results today. Analysts project earnings for firms on the gauge fell 6.7 percent in the fourth quarter, and downgrades to global profit growth haven’t been this bad in seven years.
Source : Bloomberg