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December 14, 2017
Tuesday, January 6, 2015

Wall Steet extends selloff as oil prices fall further

US stocks ended lower for a fifth session as data showed slower growth in the US service sector and oil prices fell further.

The S&P 500's losing streak was its longest in about 13 months, but the index ended off the day's lows, having fallen as much as 1.4 percent earlier, at one point breaking below the 2,000 level for the first time since Dec. 17.

Data on Tuesday pointed to slowing growth in the fourth quarter. The pace of expansion in services moderated in December and new orders for manufactured goods fell for a fourth consecutive month in November.

The S&P 500 is down 4.2 percent for the last five sessions, with the Dow and S&P 500 suffering on Monday their biggest drops since early October.

Among the day's biggest drags, the S&P energy sector fell 1.3 percent as oil prices slid further on mounting worries about a supply glut. U.S. crude settled at $47.93 a barrel, down 4.2 percent on the day. Shares of energy names tumbled, including Southwestern Energy, down 5 percent at $24.71, as brokerages continued to cut price targets.

The Dow Jones industrial average fell 130.01 points, or 0.74 percent, to 17,371.64, the S&P 500 lost 17.97 points, or 0.89 percent, to 2,002.61 and the Nasdaq Composite dropped 59.84 points, or 1.29 percent, to 4,592.74.

An election in Greece, which may trigger its exit from the euro zone, is about three weeks away, increasing the difficulty for the European Central Bank to move towards quantitative easing as it attempts to stabilize the region's economy.

Among gainers, AOL Inc shares rose 3.4 percent to $46.25 a day after a report that Verizon Communications approached AOL about a potential acquisition or joint venture.

About 8.3 billion shares changed hands on U.S. exchanges, above the 5.5 billion average for the last five sessions, according to BATS Global Markets.

Declining issues outnumbered advancing ones on the NYSE by 2,076 to 1,011, for a 2.05-to-1 ratio; on the Nasdaq, 2,117 issues fell and 657 advanced for a 3.22-to-1 ratio favoring decliners.

The S&P 500 posted 14 new 52-week highs and 15 new lows; the Nasdaq Composite recorded 38 new highs and 73 new lows.

In Europe, a rally in auto stocks helped European shares steady, as uncertainty about Greece's future in the euro zone and worries about the implications of sliding oil prices dented broader market sentiment.

Strong December industry sales data from the United States boosted car makers with Fiat Chrysler Automobiles, the most exposed Europe-listed manufacturer, up 2 percent.

The STOXX Europe 600 Auto & parts index rose 1 percent, the best performing sector in Europe.

Auto sales are an early indicator each month of consumer spending, which is deemed to have benefited from falls in oil prices to a succession of 5-1/2-year lows.

While lower energy prices are widely seen as beneficial for European companies and consumers, they pile pressure on the finances of oil-producing countries such as Russia, raising the prospect of financial instability in emerging markets and hefty losses for investors in those regions.

Brent crude briefly fell below $52 a barrel on Tuesday before staging a small recovery, which helped shares in oil majors Eni and BG Group rise over 1 percent after sharp falls in the previous session.

The broad FTSEurofirst 300 index of pan-European shares was flat at 1,332.97 points.

Uncertainty ahead of elections later this month in Greece that have revived a debate about whether the country could leave the euro zone sapped appetite for risk.

The Athens stock market was shut on Tuesday for a public holiday, having fallen 5.6 percent on Monday.

Meanwhile, Japanese stocks posted their biggest fall in nearly 10 months today, as uncertainty surrounding Greece's future in the euro zone and slumping oil prices dampened risk appetite, while a stronger yen hit exporters' shares.

In its worst day since March 14, the Nikkei benchmark slipped 3.0 percent to close at 16,883.19, not far off a six-week low of 16,672.94 hit on Dec. 17.

With oil prices at their lowest since spring 2009, the Tokyo Stock Exchange sub-index of oil and mining shares tumbled 5.5 percent. Inpex Corp shed 5.8 percent.

Exporters' shares suffered from a stronger yen, which broke through the 119 level versus the dollar late in the session. Nissan Motor Co Ltd lost 4.4 percent and Panasonic Corp slipped 3.1 percent.

The broader Topix fell 2.9 percent to 1,361.14, while the JPX-Nikkei Index 400 shed 2.9 percent to close at 12,327.80.

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