US equity indices slide into correction territory

US stocks indices lost early momentum, sliding on a volatile oil session and a major consumer discretionary retreat to finish at their lowest closing levels since late September.

The Dow Jones lost 2.2% to finish on 16,151.41, the S&P also flopping 2.5% to 1,890.28, and the Nasdaq Composite down a whopping 3.4% to complete the three-card trick with its own three-month closing low of 4,526.06.

All three stock averages closed more than 10% below their 52-week intraday highs, in correction territory.

Consumer discretionary stocks such as Netflix and Marriott International led the sector's biggest one-day retreat since the late summer, having been one of the strongest sectors last year.

The vicissitudes of the oil market saw WTI crude end the session marginally in positive territory, losing some encouraging earlier gains as oversupply concerns mingled with talk of lacklustre demand, ending a series of losing days.

Not helping matters was the release of US crude oil inventories data that showed a continue to rise in 2016 by 700,000 barrels per day, following an increase of 1.9m bpd in 2015.

Societe Generale's uber-bear strategist Albert Edward also ratcheted up the fear factor, as is his wont, with a fire-and-brimstone warning that the S&P 500 will finally complete its correction that did not fully play out in 2009 with a massive plunge to 550.

In what Edwards termed as his 'Ice Age thesis', he said: "It means global deflation and recession. The coming carnage is an indirect result of the failure of the Fed’s QE. It may not have done much to boost US growth, but it certainly inflated global asset prices into the stratosphere."

Early in the session, stocks were on the front foot after encouraging China trade data soothed concerns about the slowdown in the world’s second largest economy, lifting European stock markets too.

China’s trade surplus grew to 382.05bn yuan in December from 343.10bn yuan in November, beating analysts’ forecasts of 338.80bn yuan.

Exports rose by 2.3% in December following a 3.7% dip a month earlier. Economists had pencilled in a 4.1% drop. Imports declined 4% last month, compared to analysts’ estimates for a 7.9% fall and November’s 5.6% slide.

Capital Economics said the large trade surplus provided a cushion for the People’s Bank in the face of soaring capital outflows.

The People’s Bank of China fixed the yuan at 6.5630 to the dollar on Wednesday, marking the fourth day that the central bank has kept its yuan guidance roughly stable.

Closer to home, US mortgage applications for the week of January 8 rebounded 21.3% according to the Mortgage Bankers Association.

The dollar was up 0.25% against the pound, and 0.08% on the yen but down 1.8% against the euro. Spot gold recovered from early losses to crawl 0.7% higher to $1,093.

In company news, Supervalu lost 15.5% after posting a drop in third quarter net earnings and sales edging down in line with forecasts.

KFC’s parent company Yum! Brands was essentially flat after it reported on Tuesday that sales at its restaurants in China rose by around 1% in December, compared to its 3% decline the previous month.

Rail giant CSX Corporation lost 5.7% despite third quarter earnings that beat analysts' expectations.

GoPro lost 22% in after-hours trading after the camera maker warning of disappointing sales over the festive period and plans to cut the workforce by 7%.

S&P 500 - Risers
Southwestern Energy Co. (SWN) $6.46 +8.75%
Chipotle Mexican Grill Inc. (CMG) $428.28 +5.94%
Range Resources Corp. (RRC) $23.91 +2.84%
Newmont Mining Corp. (NEM) $17.48 +2.76%
MetLife Inc. (MET) $42.91 +2.19%
Eog Resources Inc. (EOG) $64.17 +1.99%
Consolidated Edison Inc. (ED) $66.68 +1.80%
F5 Networks Inc. (FFIV) $94.00 +1.50%
Sempra Energy (SRE) $90.24 +1.46%
Cabot Oil & Gas Corp. (COG) $15.70 +1.42%

S&P 500 - Fallers
Williams Companies Inc. (WMB) $13.61 -17.71%
Tesoro Corp. (TSO) $91.92 -12.16%
Chesapeake Energy Corp. (CHK) $3.64 -10.12%
Qorvo, Inc. (QRVO) $40.39 -9.80%
CONSOL Energy Inc. (CNX) $6.05 -9.70%
Borg Warner Inc. (BWA) $33.84 -9.52%
Freeport-McMoRan Inc (FCX) $3.74 -9.00%
Marathon Petroleum Corporation (MPC) $42.28 -8.86%
Peabody Energy Corp. (BTU) $4.09 -8.71%
Valero Energy Corp. (VLO) $65.03 -8.65%

Dow Jones I.A - Risers
Exxon Mobil Corp. (XOM) $75.65 +0.60%

Dow Jones I.A - Fallers
Home Depot Inc. (HD) $121.40 -4.78%
Goldman Sachs Group Inc. (GS) $158.99 -4.06%
E.I. du Pont de Nemours and Co. (DD) $56.79 -3.09%
Cisco Systems Inc. (CSCO) $24.60 -2.96%
Walt Disney Co. (DIS) $98.48 -2.94%
Boeing Co. (BA) $128.12 -2.88%
JP Morgan Chase & Co. (JPM) $57.34 -2.75%
Unitedhealth Group Inc. (UNH) $109.23 -2.70%
Wal-Mart Stores Inc. (WMT) $61.92 -2.67%
Apple Inc. (AAPL) $97.39 -2.57%

Nasdaq 100 - Risers
Vimpelcom Ltd Ads (VIP) $2.98 +1.36%
Intuitive Surgical Inc. (ISRG) $545.14 +0.56%

Nasdaq 100 - Fallers
Incyte Corp. (INCY) $78.42 -10.98%
Biomarin Pharmaceutical Inc. (BMRN) $84.12 -9.66%
Netflix Inc. (NFLX) $106.56 -8.59%
Autodesk Inc. (ADSK) $50.87 -7.15%
Vertex Pharmaceuticals Inc. (VRTX) $96.37 -7.01%
Express Scripts Holding Co (ESRX) $79.69 -6.88%
Skyworks Solutions Inc. (SWKS) $62.16 -6.71%
Activision Blizzard Inc. (ATVI) $34.86 -6.09%
Amazon.Com Inc. (AMZN) $581.81 -5.84%
Celgene Corp. (CELG) $100.67 -5.78%