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US: Stocks edge lower after volatile session

Wednesday, February 10, 2016 - 06:35
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[NEW YORK] US stocks finished a choppy session modestly lower on Tuesday as investors grappled with weakness in overseas equity markets and another drop in oil prices.

The Dow Jones Industrial Average shed 12.67 points (0.08 per cent) at 16,014.38.

The broad-based S&P 500 lost 1.23 (0.07 per cent) at 1,852.21, while the tech-rich Nasdaq Composite Index dropped 14.99 (0.35 per cent) to 4,268.76.

US stocks swayed between gains and losses all day after Japan's Nikkei plunged 5.4 per cent and US oil prices dived below US$28 a barrel following a downcast forecast by the International Energy Agency.

"The market is trying to find a floor," said Alan Skrainka, chief investment officer at Cornerstone Wealth Management.

"We still believe this volatility is going to continue until commodity prices settle down, and that hasn't happened yet." Mr Skrainka said investors are hopeful Federal Reserve Chair Janet Yellen will send dovish signals in a congressional hearing on Wednesday.

But if Ms Yellen takes a hard line on further interest rate increases, "then stocks will sell off," he said.

Energy stocks were under pressure with the latest drop in oil prices. Dow member Chevron fell 3.6 per cent, EOG Resources 4.2 per cent and Halliburton 4.0 per cent.

Anadarko Petroleum slid 7.0 per cent after slashing its dividend from 27 cents per share to just five cents.

But airline stocks benefited from expectations of lower fuel costs. Delta Air Lines jumped 3.0 per cent, while American Airlines and United Airlines both climbed 1.8 per cent.

Dow member Coca-Cola rose 1.5 per cent after posting a 60.6 per cent rise in fourth-quarter profit to US$1.2 billion behind higher volumes and pricing.

Media company Viacom sank 17.8 per cent on a 10.2 per cent drop in first-quarter earnings to US$449 million in results that fell short of expectations. Chief executive Philippe Dauman said the earnings reflect an adaptation to "significant industry disruption" and that results would soon improve.

CVS Health gained 1.0 per cent as it reported fourth-quarter net income rose 13.4 per cent to US$1.5 billion.

AFP