Wall Street eases as oil prices, General Electric fall

Updated: Wed, Jan 17, 2018
03:06 am
Reuters
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Wall Street paused its rally on Tuesday, weighed down by weakness in General Electric shares and as lower oil prices dragged down the energy sector.

The energy sector <.spny> fell 1.2 percent as Brent crude oil shed some of its recent gains, falling nearly $1 per barrel. Industrials <.splrci> and materials <.splrcm> were the other major laggards on the S&P, down 0.9 percent and 1.2 percent, respectively.

General Electric fell 2.9 percent after raising the prospect of breaking itself up and announcing more than $11 billion in charges from its long-term care insurance portfolio and new U.S. tax laws.

The CBOE Volatility index <.vix>, a widely followed measure of market anxiety, rose to a more than 1-month high of 11.66.

"Lower energy prices are taking us down a little bit," said Tracie McMillion, head of global asset allocation strategy at Wells Fargo Investment Institute in Winston-Salem, North Carolina.

But, she added, "investors are continuing to move into equities as they see returns. It`s feeding on itself, becoming a virtuous cycle, enticing more people in."

The Dow Jones Industrial Average <.dji> fell 10.33 points, or 0.04 percent, to 25,792.86, the S&P 500 <.spx> lost 9.82 points, or 0.35 percent, to 2,776.42 and the Nasdaq Composite <.ixic> dropped 37.38 points, or 0.51 percent, to 7,223.69.

Earlier on Tuesday, the Dow Jones Industrial Average had broken above the 26,000 mark for the first time as fourth-quarter earnings season got off to a strong start following upbeat results from UnitedHealth and Citigroup.

UnitedHealth rose 1.9 percent after the largest U.S. health insurer reported results that beat estimates and raised its 2018 earnings outlook.

More than three quarters of the 30 S&P 500 companies that have reported so far have topped profit estimates, according to Thomson Reuters I/B/E/S.

"You`d typically see and expect the markets to interpret that in a positive manner, but a lot of indices have moved back. What`s held them back seems to be company-specific," said Shawn Cruz, senior trading specialist at TD Ameritrade in Chicago, making reference to General Electric.

Cruz added that the Federal Reserve Bank of New York`s business conditions index, which came in slightly below expectations on Tuesday, may have also contributed to Wall Street`s dip.

Merck surged 5.8 percent after early results from a key study showed its blockbuster drug Keytruda and two chemotherapy medicines helped lung cancer patients live longer and stopped the disease from advancing.

Viacom fell 7.0 percent after sources told Reuters CBS Corp and the company were not in active merger discussions.

Declining issues outnumbered advancing ones on the NYSE by a 2.04-to-1 ratio; on Nasdaq, a 2.18-to-1 ratio favored decliners.

The S&P 500 posted 170 new 52-week highs and six new lows; the Nasdaq Composite recorded 243 new highs and 29 new lows.

Volume on U.S. exchanges was 8.30 billion shares, compared to the 6.48 billion average over the last 20 trading days.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)

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