By Abhiram Nandakumar
REUTERS – Wall Street was lower on Thursday as oil prices slid and investors worried that measures taken by central banks may not be enough to put the global economy back on track.
Crude fell more than 2 percent as a rise in Iraqi exports offset gains from an unexpected fall in U.S. inventories. Exxon fell 1.4 percent. [O/R]
Minutes from the Fed’s March meeting released on Wednesday pointed to concerns about the central bank’s limited ability to tackle a global economic slowdown, reducing the odds of a rate increase before June.
While the Fed has projected two rate increases this year, the market is pricing in a near 60-percent chance of a hike in December, according to CME Group’s FedWatch Program.
The dollar was under pressure on Thursday as investors sought safety in the yen and gold.
“Today, the yen is really the name of the game, because there’s indications that Japan might not really be able to escape that funk that it’s in,” said Jeff Weniger, senior portfolio strategist at BMO Private Bank in Chicago.
First-quarter earnings at S&P 500 companies are expected to decline 7.4 percent, according to Thomson Reuters data.
At 12:40 p.m. ET, the Dow Jones industrial average was down 158.44 points, or 0.89 percent, at 17,557.61, the S&P 500 was down 21.19 points, or 1.03 percent, at 2,045.47 and the Nasdaq Composite was down 58.73 points, or 1.19 percent, at 4,861.98.
All 10 major S&P sectors were lower, led by a 1.65 percent fall in the telecom sector. Verizon led the selloff, falling 2.8 percent to $ 52.01, after Jefferies and Bernstein cut their ratings on the stock.
Apple’s 1.3 percent decline to $ 109.54 weighed the most on the S&P 500 and the Nasdaq. Goldman Sachs was the biggest drag on the Dow, slipping 2.5 percent to $ 151.27.
Fed Chair Janet Yellen, who has urged caution on raising rates, is slated to speak on monetary policy along with three former central bank chairmen in New York later in the day.
Among the bright spots, Valeant Pharmaceuticals rose 5.2 percent at $ 35.92 after the company secured a waiver and amendments to its credit facility.
Declining issues outnumbered advancing ones on the NYSE by 2,264 to 658. On the Nasdaq, 1,915 issues fell and 756 advanced.
The S&P 500 index showed seven new 52-week highs and one new low, while the Nasdaq recorded 18 new highs and 12 new lows.
(Reporting by Abhiram Nandakumar in Bengaluru; Editing by Anil D’Silva)
