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US: Stocks drop as oil hits new multi-year low
[NEW YORK] US stocks opened Monday a busy week of corporate earnings sharply lower as oil prices slumped to fresh multi-year lows.
The Dow Jones Industrial Average dropped 96.53 points (0.54 per cent) to 17,640.84.
The broad-based S&P 500 sank 16.55 (0.81 per cent) to 2,028.26, while the tech-rich Nasdaq Composite Index tumbled 39.36 (0.84 per cent) to 4,664.71.
European benchmark Brent oil closed below US$50 a barrel for the first time since April 2009 following a gloomy petroleum-market forecast from Goldman Sachs.
Energy equities fell sharply, including Dow member Chevron and Marathon Oil, by 2.2 per cent and 5.1 per cent, respectively.
"The market is nervous about lower energy prices and whether they are forecasting a slowdown in global economic growth, and not just a supply-demand imbalance," said Sam Stovall, chief investment strategist at S&P Capital IQ.
NPS Pharmaceuticals bolted 8.2 per cent higher after announcing plans to be bought by Ireland-based Shire for US$5.2 billion.
Animal-health company MWI Veterinary Supply gained 8.2 per cent on news it will be acquired by pharmaceutical distributor AmerisourceBergen for US$2.5 billion. AmerisourceBergen lost 2.2 per cent.
Drugmaker Bristol-Myers Squibb advanced 3.1 per cent on news that a study for its Opdivo lung cancer drug was stopped because an independent panel found that the medicine succeeded in improving survival rates in patients.
Biotech company Celgene tacked on 2.9 per cent as it projected 2015 sales of US$9-$9.5 billion, a 22 per cent increase from last year.
Jewelry chain Tiffany slumped 14.0 per cent as it said sales during the key holiday period fell one percent from last year, with an especially weak performance in Japan. Chief Michael Kowalski characterized the results as "disappointing overall." SanDisk, which manufacturers data storage products in consumer electronics, lost 13.9 per cent after announcing that it expects fourth-quarter sales of US$1.73 billion, down from a previous forecast for US$1.80-$1.85 billion.
Bond prices rose. The yield on the 10-year US Treasury fell to 1.91 per cent from 1.96 per cent Friday, while the 30-year declined to 2.49 per cent from 2.54 per cent. Bond prices and yields move inversely.