Oil price fall sinks Wall Street stocks

[NEW YORK] Another plunge in oil prices sent Wall Street stocks tumbling again Friday, dragging down other sectors in a bearish turn ahead of next week's landmark Federal Reserve meeting.

Even the positive reviews of the mega-merger of two venerable US industrial blue chips, Dow Chemical and DuPont, were not enough to support their shares in a determined sell-off of the market.

The Dow Jones Industrial Average fell 309.54 points (1.76 per cent) to 17,265.21.

The broad-based S&P 500 lost 39.86 (1.94 per cent) at 2,012.37, while the tech-rich Nasdaq Composite Index dropped 111.71 (2.21 per cent) to 4,933.47.

The Friday fall left all three with heavy losses for the week: The Dow was down 3.3 per cent, the S&P 3.8 per cent, and the Nasdaq 4.1 per cent.

The crude oil price story continued to dominate, after the International Energy Agency warned that global inventories "are set to keep building at least until late 2016." In reaction London's Brent contract dropped 4.5 per cent to US$37.93 a barrel and New York's WTI fix lost 3.1 per cent at US$35.62 a barrel.

On the New York Stock Exchange, Dow members Chevron and ExxonMobil lost 3.2 per cent and 1.8 per cent, respectively, and Schlumberger fell 2.3 per cent.

Dow Chemical and DuPont both gave up much of the sharp gains that came Wednesday when news leaked they were negotiating a merger that will create a global chemicals and materials giant worth US$130 billion.

The all share-swap deal will power the new DowDupont past Germany's BASF as the world's leading chemicals group when it is completed, expected late next year.

Dow Chemical ended 2.8 per cent lower and Dow member DuPont gave up 5.5 per cent.

Elsewhere on the Dow blue-chips roster, Goldman Sachs sank 3.1 per cent and Nike 1.8 per cent.

Other banks lost as well: Bank of America fell 2.7 per cent and Citigroup 2.9 per cent.

Among tech shares, Alibaba lost 5.4 per cent after announcing it would buy Hong Kong's leading English-language newspaper.



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