US close: Stocks end lower as oil prices retreat
US stocks ended in the red on Tuesday with energy issues under the cosh amid falling oil prices, as investors continued to digest dovish comments by Federal Reserve governor Lael Brainard.
The Dow Jones Industrial Average ended 1.4% lower, the S&P 500 declined 1.5% and the Nasdaq slid 1.1%.
At the same time oil prices slid after the International Energy Agency said the crude market will be oversupplied at least through the six months of 2017. West Texas Intermediate crude was down 3% to $44.90 a barrel and Brent was down 2.4% to $47.17. This weighed on energy stocks, with the likes of Chevron and Exxon both firmly on the back foot.
Stocks in the US had ended higher on Monday on the back of a dovish speech by Federal Reserve governor Lael Brainard, who said at the Chicago Council on Global Affairs that although economic progress is being made, it would be wise for the Fed to keep monetary policy loose.
In addition, Minneapolis Fed President Neel Kashkari told CNBC that policy makers should take their time to when it comes to making a decision on interest rates.
The more dovish tone from Brainard and Kashkari followed hawkish comments last week from Boston Fed President Eric Rosengren, which had sparked concerns that the Fed would hike rates at its next policy meeting on 20-21 September.
“The Federal Reserve blackout period is now upon us, giving traders a week to speculate on the impact of what has been said and the few pieces of data we get between now and the decision next Wednesday,” said Craig Erlam, senior market analyst at Oanda.
“While a hawkish consensus does appear to be building among the committee, the absence of some key policymakers from this makes a hike at the meeting next week very unlikely.”
In other US economic news, the NFIB small-business index fell in August to 94.4 from 94.6 in July. Economists had expected a reading of 94.8.
On the corporate front, semiconductor maker Intersil Corp surged after Japanese chip maker Renesas Electronics announced that it will buy the company for $3.2bn.
Oil and gas firm Anadarko Petroleum slumped after saying late on Monday that its board of directors has agreed to buy the deepwater Gulf of Mexico assets of Freeport McMoRan Oil & Gas for $2bn.
Tiffany & Co. rallied after the jeweller named Mark Erceg as its chief financial officer.
S&P 500 - Risers
Paypal Holdings Inc (PYPL) $39.86 +2.81%
Apple Inc. (AAPL) $107.95 +2.38%
Skyworks Solutions Inc. (SWKS) $69.36 +1.49%
Carnival Corp. (CCL) $45.63 +0.91%
Tiffany & Co. (TIF) $68.74 +0.64%
Signet Jewelers Ltd (SIG) $78.97 +0.55%
AutoZone Inc. (AZO) $744.15 +0.51%
Best Buy Co. Inc. (BBY) $37.47 +0.48%
Broadcom Limited (AVGO) $165.24 +0.46%
Qorvo, Inc. (QRVO) $53.92 +0.30%
S&P 500 - Fallers
Freeport-McMoRan Inc (FCX) $10.15 -8.39%
NRG Energy Inc. (NRG) $10.98 -8.35%
Chesapeake Energy Corp. (CHK) $7.38 -8.32%
Murphy Oil Corp. (MUR) $26.14 -7.53%
Marathon Oil Corp. (MRO) $14.34 -7.30%
United States Steel Corp. (X) $16.35 -6.20%
CF Industries Holdings Inc. (CF) $24.01 -5.88%
Noble Energy Inc. (NBL) $34.75 -5.16%
Transocean Ltd. (RIG) $9.31 -5.10%
Southwestern Energy Co. (SWN) $14.19 -5.02%
Dow Jones I.A - Risers
Apple Inc. (AAPL) $107.95 +2.38%
Dow Jones I.A - Fallers
Chevron Corp. (CVX) $99.43 -2.76%
Exxon Mobil Corp. (XOM) $85.21 -2.38%
Goldman Sachs Group Inc. (GS) $167.00 -2.37%
American Express Co. (AXP) $64.36 -2.34%
Home Depot Inc. (HD) $125.72 -2.23%
Merck & Co. Inc. (MRK) $61.81 -2.18%
Verizon Communications Inc. (VZ) $51.45 -2.13%
Coca-Cola Co. (KO) $42.28 -2.11%
General Electric Co. (GE) $29.85 -2.10%
Caterpillar Inc. (CAT) $80.23 -2.06%
Nasdaq 100 - Risers
Liberty Media Corporation - Class A (LMCA) $27.83 +15.81%
Liberty Media Corporation - Series C (LMCK) $27.30 +15.14%
Apple Inc. (AAPL) $107.95 +2.38%
Skyworks Solutions Inc. (SWKS) $69.36 +1.49%
Broadcom Limited (AVGO) $165.24 +0.46%
Tractor Supply Company (TSCO) $69.29 +0.26%
Western Digital Corp. (WDC) $52.37 +0.11%
Norwegian Cruise Line Holdings Ltd. - Ordinary Shares (NCLH) $35.29 +0.11%
JD.com, Inc. (JD) $26.53 +0.11%
Electronic Arts Inc. (EA) $80.87 +0.04%
Nasdaq 100 - Fallers
CA Inc. (CA) $32.13 -3.37%
Viacom Inc. Class B (VIAB) $36.80 -3.36%
Netflix Inc. (NFLX) $96.09 -2.99%
Monster Beverage Corp (MNST) $143.92 -2.95%
Ctrip.Com International Ltd. Ads (CTRP) $43.08 -2.80%
Dollar Tree Inc (DLTR) $80.18 -2.67%
Vertex Pharmaceuticals Inc. (VRTX) $95.27 -2.65%
Vodafone Group Plc ADS (VOD) $29.66 -2.63%
Intuit Inc. (INTU) $106.70 -2.59%
American Airlines Group (AAL) $37.37 -2.53%