US: Stocks retreat on oil price jump, hawkish Federal Reserve

[NEW YORK] Wall Street stocks retreated on Monday, ending last week's rally as oil prices pushed higher and the Federal Reserve's top official delivered hawkish comments on inflation.

Remarks from Baltic states favoring an embargo on Russian oil and gas helped push crude prices further above US$100 a barrel as analysts see evidence that some petroleum buyers are already "self-sanctioning" and avoiding Russian oil.

Fed Chair Jerome Powell said the US central bank is prepared to raise interest rates by bigger steps than the quarter-point hike announced last week if that is what's needed to contain "much too high" inflation.

Stocks weakened after Powell's remarks, with some observers viewing them as more hawkish than his statements at last week's news conference.

The Dow Jones Industrial Average finished down 0.6 per cent at 34,552.99.

The broad-based S&P 500 slipped less than 0.1 per cent to 4,461.18, while the tech-rich Nasdaq Composite Index dropped 0.4 per cent to 13,838.46.

Stocks are coming off a strong week, with the S&P 500 piling on more than six percent amid bargain hunting and positive trading momentum.

Among individual companies, Boeing fell 3.6 per cent after a Boeing 737-800 operated by China Eastern crashed in China, killing 132 people.

The catastrophe comes as the American plane maker was poised to resume deliveries of the 737 MAX, a different plane, following a lengthy grounding.

Insurance firm Alleghany Corporation jumped nearly 25 per cent after agreeing to be acquired by Warren Buffett's company Berkshire Hathaway for US$11.6 billion.

This week's calendar includes reports on new home sales and durable goods. AFP