Stocks in the US swung back into sell mode on Tuesday, with energy stocks leading declines among all 10 of the Standard & Poor’s 500 sectors as crude prices fell.
Investors put pressure on equities once more ahead of next week’s pivotal Federal Open Market Committee meeting, which is preceded this week by key data on inflation, retail sales and manufacturing. The probability that interest rates will increase this month was 15% on the CME Group’s Fed Watch tool, unchanged from Monday, when dovish comments from Fed Governor Lael Brained ignited a stocks rally.
The International Energy Agency’s report that the global oil supply glut is seen continuing into next year jolted energy markets, sending benchmark US crude down about 3% by the close. Chevron’s (CVX) 2.8% drop led the components on the Dow Jones Industrial Average broadly lower. ExxonMobil (XOM) fell 2.4%.
Only Apple (AAPL) managed gains among the blue chips, rising 2.6% on news from T-Mobile US (TMUS) and Sprint (S) that pre-orders for the latest iPhones were soaring. That wasn’t enough to help the S&P’s measure of technology stocks, which fell 0.5%. Telecommunication services and materials each lost 1.8% while financials were down 1.6%.
Monsanto (MON) slipped 0.8% even as reports emerged that Bayer AG was upping its takeover bid for the agriculture giant. Freeport-McMoRan (FCX) closed 8.4% lower after it announced plans late Monday to sell Gulf of Mexico oil assets to Anadarko Petroleum (APC), which slipped 0.4%.
Vivint Solar (VSLR) fell 6.3% after a bankruptcy judge ruled that the company’s case against SunEdison (SUNE) can’t proceed. SunEdison ended 2.1% stronger.
On Wednesday, the weekly Mortgage Bankers’ Association applications index is out at 7 a.m. ET while August import and export prices are due at 8:30 a.m.
By the close, the S&P 500 was down 1.5%, the Dow was 1.4% lower and the Nasdaq Composite lost 1.1%.
Globally, the FTSE 100 was down 0.5%, the Nikkei 225 rose 0.3%, the Hang Seng lost 0.3% and the Shanghai Composite was up less than 0.1%.