US stocks move lower as commodities prices fall

SEOUL, South Korea (AP) – Global stock markets were mostly weaker Tuesday as the price of crude oil turned lower on supply concerns. Japan’s Nikkei 225 Index dropped by 0.9 percent, while Hong Kong’s Hang Seng Index slid by 1.2 percent.

Oil also played a major factor in Tuesday’s selloff on the US stock markets (http://www.marketwatch.com/story/US-stock-futures-retreat-as-oil-drops-2016-02-23), where the Dow industrials and S&P 500 index posted their worst loss in a week and erased most of their gains from Monday’s session.

Home Depot shares were up about 4% in early trading, leading the Dow, after the company reported strong quarterly results with its 19th straight quarter of same-store-sales growth. Crude oil tumbled more than 4 percent.

The major European markets have also come under pressure on the day.

Global stocks had climbed last week, recouping some of the steep losses in financial markets earlier this year.

Western Digital dropped 6.5 percent to $43.12 after it cut the price of its planned acquisition of rival US hard-disk maker SanDisk Corp by more than $3 billion after losing a big investment from China’s Unisplendour Corp Ltd. SanDisk fell 1.5 percent.

Macy’s rose 3.0 percent after reporting fourth-quarter earnings of $2.26 per share, much above the $1.89 expected by analysts.

The S&P 500 was down 22.73 points, or 1.17 per cent, at 1,922.77 and the Nasdaq Composite index was down 66.66 points, or 1.46 per cent, at 4,503.95.

Also weighing on market sentiment on Wall Street were comments after Tuesday’s market close from Federal Reserve vice chairman Stanley Fischer.

Cabot Oil and Gas sank 10.6 per cent as a civil trial began in the state of Pennsylvania over allegations that fracking from Cabot wells contaminated drinking water.

Only the Utility sector ended in positive territory, up less than 0.1%.

While higher oil prices fueled yesterday’s gains, the opposite was true today, as commodity prices slipped, hurt in part by Saudi Arabia said that it wouldn’t’ cut production to support oil prices.

Volatile oil prices have influenced the direction of stocks, pushing the S&P 500 down more than 5 percent this year.

Weak U.S. consumer confidence data on Tuesday did little to reassure investors about the strength of the U.S. economy. The broad Stoxx Europe 600 was down 2.1%, while Germany’s DAX was off 2.3% and the CAC 40 in Paris was 2.1% lower.

“While [traders are] closely watching oil and stock prices, it seems investors are not taking positions”, said Sumitomo Mitsui Trust Bank research head Ayako Sera, referring to the rush to the yen.