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U.S. stocks halt 3-day win streak, as oil rout outweighs Fed gains

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Investing.com -- U.S. stocks tumbled nearly 1%, as a Fed-inspired rally stemming from its historic rate hike a session earlier was dented by the continual downturn in crude oil prices , amid festering concerns related to the supply-demand imbalance on energy markets worldwide.

U.S. crude future prices tumbled below $35 a barrel on Thursday, falling near seven-year lows from the start of the week. Over the last year, crude has slumped approximately 50% dragging down energy stocks and equity markets, as a whole. The energy rout has had widespread ramifications on the global economy, impacting major oil-producing states on all corners of the world. While delivering his year-end annual press conference on Thursday, Russia president Vladimir Putin noted that the country's 2016 budget is based on crude at $50 a barrel.

The Dow Jones Industrial Average fell 253.11 or 1.43% to 17,495.98, while the NASDAQ Composite index dropped 68.58 or 1.35% to 5,002.55, each halting a three-day winning streak. The S&P 500 Composite index, meanwhile, lost 31.18 or 1.50% to 2,041.89, as nine of 10 sectors closed in the red. Stocks in the Energy, Basic Materials and Industrials sectors lagged, each falling by more than 1.50% on the session. Stocks in the Utilities industry, the lone sector to close in positive territory, led.

On Wednesday, the Federal Reserve ended its seven-year policy of holding interest rates at near-zero levels when it approved a modest quarter-point rate hike.

The top performer on the Dow was UnitedHealth Group Incorporated (N:UNH), which gained 0.65 or 0.55% to 119.48, one day after analysts at Credit Suisse (VX:CSGN) upgraded its rating to outperform. Earlier this week, Sen. Richard Blumenthal (D - Connecticut) asked the nation's largest healthcare insurer to reconsider its proposed decision to leave the Obamacare state-run health care exchanges. The worst performer was Caterpillar Inc (N:CAT), which fell 2.70 or 3.99% to 65.02, pushed down by cascading prices in mining and other commodities.

Shares in Apple Inc (O:AAPL) lost more than 2% 108.98, after the tech giant named Jeff Williams as its Chief Operating Officer in its latest series of leadership changes. Williams' appointment represents the first time Apple (O:AAPL) has restored the title since Tim Cook became CEO in 2011.

The biggest gainer on the NASDAQ was Micron Technology Inc (O:MU) which gained 0.21 or 1.49% to 14.28, amid strong valuations from a host of top analysts. Shares in Micron, one of the largest memory semiconductors in the world, are down by nearly 60% this year. The worst performer was Wynn Resorts Limited (O:WYNN), which fell 4.74 or 6.87% to 64.25 after it received a downgrade by analysts at Zacks Investment Research. Last week, Wynn Resorts received a boost after CEO Steve Wynn announced that he was purchasing a million shares in the multinational casino.

The top performer on the S&P 500 was CONSOL Energy Inc (N:CNX), which gained 0.27 or 4.05% to 6.94. The worst performer was Freeport-McMoran Copper & Gold Inc (N:FCX), which plunged 0.58 or 8.67% to 6.11. Freeport McMoran, a Phoenix-based mining company, is one of the world's largest producers of gold and copper. Gold futures crashed by $25 an ounce to near multi-year lows on Thursday in the aftermath of the Fed's move.

Major interest rate hikes are viewed as bearish for gold, which struggles to compete with high-yield bearing assets.

On the New York Stock Exchange, declining issues outnumbered advancing ones by a 1,952 to 1,156 margin.

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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.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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