US stocks stabilize, shaking off another drop in China

Author: the associated press
Published:
MGN

Major U.S. stock indexes were little changed in midday trading Monday as investors weighed the implications of another slump in China’s stock market. Energy companies were among the biggest decliners as the price of crude oil fell.

KEEPING SCORE: The Dow Jones industrial average was little changed at 16,348 as of 12:14 p.m. Eastern time. The S&P 500 index shed less than one point to 1,921. The Nasdaq composite lost 11 points, or 0.3 percent, to 4,631. The market losses come after U.S. stocks posted their worst week in more than four years.

THE QUOTE: “Investors have one eye on China, and all that’s going on there, and the other eye on oil,” said Erik Davidson, chief investment officer at Wells Fargo Private Bank. “Those two things are keeping investors on pins and needles right now.”

ENERGY: Benchmark U.S. crude shed $1.83, or 5.5 percent, to $31.36 a barrel in New York. Brent crude, a benchmark for international oils, fell $2.06, or 6.1 percent, to $31.87 a barrel in London.

OIL DRAG: Several energy and mining companies slumped as crude oil and other commodity prices fell. Freeport-McMoRan sank 99 cents, or 18 percent, to $4.41, making it the biggest decliner in the S&P 500 index. Consol Energy also slumped, losing 87 cents, or 11.3 percent, to $6.82. Southwest Energy shed 54 cents, or 7.8 percent, to $6.41.

DONE DEAL: Irish drugmaker Shire announced its long-rumored agreement to buy U.S.-based rival Baxalta for about $32 billion in cash and stock. The boards of both companies have agreed to the deal, and they expect it to close in the middle of the year. Shire slid $3.52, or 8.2 percent, to $39.25. Baxalta fell 82 cents, or 2 percent, to $39.19.

HEALTHY OUTLOOK: HCA Holdings jumped 6.9 percent after the hospital operator raised its profit forecast. The stock added $4.41 to $68.68. Tenet Healthcare also rose, climbing 74 cents, or 2.9 percent, to $26.08. Both companies were among the biggest gainers in the S&P 500 index.

SECTOR VIEW: Six of the 10 sectors in the S&P 500 index moved higher, led by utilities stocks, which were up 0.7 percent. Energy stocks were down the most, 1.5 percent, while materials stocks shed 1.4 percent.

ROUGH WEEK: U.S. stocks are coming off their worst-ever opening week of a year and the biggest weekly slide since September 2011. The slump came as a weakening of China’s currency and steep drops in its stock market stoked worries over the outlook for the world’s second-largest economy.

OVERSEAS: European markets were down. Germany’s DAX slipped 0.2 percent, while the CAC-40 in France lost 0.5 percent. The FTSE 100 index of leading British shares slid 0.7 percent. In Asia, Chinese stocks sank again after a rebound Friday that analysts suggested was due to buying from a group of state entities dubbed the “National Team.” The Shanghai Composite Index fell 5.3 percent and Hong Kong’s Hang Seng sank 2.8 percent. Sydney’s S&P/ASX 200 lost 1.2 percent, while Seoul’s Kospi fell 1.2 percent. Tokyo’s markets were closed for a holiday.

BONDS AND CURRENCIES: Bond prices fell. The yield on the 10-year Treasury note rose to 2.14 percent from 2.12 percent late Friday. The euro fell to $1.0888 from $1.0903 and the dollar edged down to 117.32 yen compared with 117.67 yen late Friday.

Copyright ©2024 Fort Myers Broadcasting. All rights reserved.

This material may not be published, broadcast, rewritten, or redistributed without prior written consent.