US: Stocks tumble on oil prices, Greece uncertainty

[NEW YORK] US stocks tumbled on Tuesday on worries about higher oil prices and a spike in tensions over the Greek debt crisis.

The Dow Jones Industrial Average dropped 142.20 points (0.79 per cent) to 17,928.20.

The broad-based S&P 500 lost 25.03 (1.18 per cent) at 2,089.46, while the tech-rich Nasdaq Composite Index sank 77.60 (1.55 per cent) to 4,939.33.

Jack Ablin, chief investment officer at BMO Private Bank, cited the rise in US oil prices above US$60 a barrel as a drag on stocks. US gasoline prices have risen 10 per cent in the last month.

Analysts also cited a sharp rise in the US trade deficit in March and the growing rift between Greece and its creditors over the terms of a bailout. European stocks fell sharply, with Germany's DAX 30 dropping 2.5 per cent and France's CAC 40 losing 2.2 per cent.

Losses were broad-based with virtually all members of the 30-stock Dow ending lower.

However, many technology companies fell a bit harder than companies in other sectors. Dow members Apple and Intel fell 2.3 per cent and 2.4 per cent, respectively, while Google dropped 1.9 per cent and Gilead Sciences shed 2.5 per cent.

Exceptions included Netflix (+1.9 per cent), which was upgraded by Bank of America Merrill Lynch, and Tesla Motors (+1.1 per cent), which reports earnings on Wednesday.

Chinese online giant Alibaba fell 1.3 per cent to a new all-time low below US$80, two days before it releases quarterly earnings. Chairman Jack Ma announced a hiring freeze last week, saying the company had grown too fast.

Cosmetics company Estee Lauder jumped 4.0 per cent as net income for the quarter ending March 31 came in at 71 cents per share, seven cents above expectations.

EOG Resources tumbled 4.9 per cent after reporting a first-quarter loss of US$169.7 million. The oil producer was also singled out by money manager David Einhorn at an investor presentation Monday for wasteful spending on fracking.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.18 per cent from 2.13 per cent on Monday, while the 30-year advanced to 2.91 per cent from 2.87 per cent. Bond prices and yields move inversely.

AFP