Stocks Fall Sharply Again on Energy Concerns; Dow Off 364 Points
Source: NBC NEWS
Major U.S. stock indices fell sharply again Wednesday on concerns about an oversupplied energy market, with the Dow Jones industrial average shedding more than 350 points, or more than 2 percent.
The S&P 500 also finished down more than 2 percent and finished below 1,900 for the first time since September -- officially in "correction" territory, meaning it is down at least 10 percent from its November peak. The tech-heavy Nasdaq composite index was hammered even harder losing more than 3 percent of its value.
The Dow finished the day down 364.6 points, or 2.21 percent; the S&P lost 48.38 points, or 2.5 percent, and the Nasdaq dropped 159.85 points, or 3.41 percent.
The markets rallied early in the day on better-than-expected news on Chinese exports, but the optimism was punctured by U.S. data on oil and gas inventories.
Read more: http://www.nbcnews.com/business/markets/stocks-fall-sharply-again-energy-concerns-dow-364-points-n495996
lapfog_1
(29,199 posts)I think the Saudis have increased oil production in an effort to kill off uneconomical competition like Canadian Tar Sands.
They calculate that they can lower oil prices to a point where many Tar Sands (and oil shale and other marginal oil producers) companies literally go out of business... then they (OPEC) hike prices again.
Classic dumping strategy.
The stock market is reacting more to the slow down of the Chinese economy... however the rate of growth in China as simply unsustainable.
Those two factors (oil prices are below $30 a barrel and Chinese slowdown) are complicated by US elections... uncertainty is the enemy of a high DJI... and our election cycle is clearly creating uncertainty in the markets.
FreakinDJ
(17,644 posts)Or they are simply unwilling to pump money into the bubble
And yes the Saudis' have already said they are going to crush all the competition by dumping cheap oil - but they also have their own domestic problems now of having to keep on pumping to pay off loans. They gave every man woman and child in the kingdom $50000 of "We Love our King" money to quell any possible "Arab Spring" uprising
houston16revival
(953 posts)It just slides. No bounce at all.
Here's on of the sites I've watched for ten years
http://www.wwfn.com/crashupdate.html
gvstn
(2,805 posts)We've seen this movie before. During Clinton's first two years there were a few months where gas went down to 89 cents a gallon from a stable about $1.25 or so. 3 months later they corrected that mistake by going over $2/gallon. My advice don't count on this price drop to last very long. (Not sure of the oil price but it went from something like $40 to $20).
Maybe my inflation numbers are wrong and oil should be at $80 but not $120. It went up too fast and stayed their too long.
Proserpina
(2,352 posts)Wishful thinking without a basis....no confidence fairies flying, and no plunge protection team able to stem the flow of arterial blood.