Stocks continue to lose altitude Wednesday as profit-taking gains momentum after the World Bank lowered its global growth forecasts. The S&P 500 and the Dow Jones Industrials Average also are running into strong resistance as the S&P edges near its 2,000 level and the Dow closes in on 17,000. Airline stocks were taking the brunt of today's weakness after Germany's Lufthansa issued a profit-warning for 2014 and 2015, taking the entire transport sector lower. But energy stocks were outperforming as fighting in Iraq is driving crude oil up another 30 cents per barrel today.
After the close on Tuesday, the World Bank shaved its global growth forecast for 2014 to 2.8% from 3.2%, citing the usually cold winter in the U.S. and geo-political tensions in Ukraine along with the impact of more restrictive Fed policy on the economies of emerging markets. The bank also lowered its growth expectations for the U.S. this year to 2.1% from 2.8% as the impact from this past winter permeates the domestic economy.
The impact from the World Bank's downbeat assessment of the global economy was not only felt in the U.S. but across Europe as well where indices across the continent all closed in negative territory. Airline stocks were also under water due to Lufthansa as well as an order cancellation for France's Airbus.
Crude oil was up $0.26 to $104.61 per barrel. Natural gas was up $0.01 to $4.54 per 1 million BTU. Gold was up $2.40 to $1,262.50 an ounce, while silver was up $0.05 to $19.22 an ounce. Copper was up $0.01 to $3.05 per pound.
Among energy ETFs, the United States Oil Fund was unchanged at $38.28 with the United States Natural Gas Fund was up 0.20% to $25.14. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was up 1.81% to 23.40 while SPDR Gold Shares were up 0.07% to $121.48. The iShares Silver Trust was up 0.08% to $18.47.
Here's where the markets stand at mid-day:
NYSE Composite Index down 33.32 (-0.31%) to 10,880.88
Dow Jones Industrial Average down 87.91 (-0.52%) to 16,858.01
S&P 500 down 5.83 (-0.30%) to 1,944.96
Nasdaq Composite Index down 4.18 (-0.10%) to 4,333.82
GLOBAL SENTIMENT
Nikkei 225 Index up 0.50%
Hang Seng Index down 0.25%
Shanghai China Composite Index up 0.12%
FTSE 100 Index down 0.50%
CAC 40 down 0.87%
DAX down 0.79%
NYSE SECTOR INDICES
NYSE Energy Sector Index up 0.20%
NYSE Financial Sector Index down 0.53%
NYSE Healthcare Sector Index down 0.09%
UPSIDE MOVERS
(+) BIOF (-42.24%) Buys JBGL Builder Finance, units of JBGL Capital For $275 mln.
(+) SYNA (+25.13%) Raised Q4 revenue guidance.
(+) BYD (+5.36%) Settles property tax dispute with Atlantic City.
(+) HRB (+2.54%) Q4 earnings beat estimates.
(+) MONT (+8.78%) To be acquired by Shaghai Pudong Science & Tech Inc for $22.60 per share.
DOWNSIDE MOVERS
(-) OREX (-17.33%) FDA has delayed a decision on Contrave until September.
(-) DAL (-2.86%) Weighed down by Lufthansas 2014 guidance cut.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
