US stocks sink as oil tumbles to fresh multi-year low
A board above the floor of the New York Stock Exchange shows the intraday price of oil, top, Tuesday, Jan. 6, 2015. US stocks fell again Tuesday on another stormy day for global financial markets as oil prices plummeted to a fresh multi-year low. AP PHOTO/RICHARD DREW
NEW YORK–US stocks fell again Tuesday on another stormy day for global financial markets as oil prices plummeted to a fresh multi-year low.
The Dow Jones Industrial Average dropped 130.01 points (0.74 percent) to 17,371.64.
The broad-based S&P 500 tumbled 17.97 (0.89 percent) to 2,002.61, after spending a good chunk of the session below 2,000. The tech-rich Nasdaq Composite Index sank 59.84 (1.29 percent) to 4,592.74.
US oil prices tumbled to a fresh 5.5-year low of $47.93 a barrel. Other worries pertained to the drop in US Treasury bond yields and the eurozone.
“The market doesn’t like uncertainty and the volatility in oil and the volatility in interest rates have certainly created uncertainty,” said David Levy, portfolio manager at Kenjol Capital Management.
“The situation in Europe is also very uncertain and we’re lacking a positive catalyst as of today.”
Banking stocks fell. Dow member JPMorgan Chase lost 2.6 percent, Citigroup tumbled 3.5 percent and Wells Fargo shed 2.1 percent.
Petroleum-linked stocks continued to drop. ConocoPhillips slumped 4.1 percent while oil services giant Schlumberger gave up 2.0 percent.
Microblog company Twitter surged 6.5 percent on speculation that activist investor Carl Icahn could buy a stake in the company.
Michael Kors, a retailer of handbags and clothing, tumbled 8.4 percent following a downgrade by Credit Suisse. The note cited “a dramatic ramp in promotional activity seen across the retail landscape” for Kors handbags, which account for 80 percent of sales.
Coach, which also sells handbags among other upscale accessories, fell 1.2 percent after it announced it will buy Stuart Weitzman Holdings, which makes women’s luxury footwear, in a deal worth up to $574 million.
Bond prices rose sharply.
The yield on the 10-year US Treasury fell to 1.94 percent from 2.04 percent Monday, dipping below 2.0 percent for the first time since October. The yield on the 30-year bond declined to 2.50 percent from 2.60 percent. Bond prices and yields move inversely.
