Wall Street hit by Saudi attacks; energy stocks temper losses

By Medha Singh and Ambar Warrick (Reuters) - U.S. stocks fell on Monday on global growth worries after weekend attacks on Saudi Arabia's crude facilities hit 5% of the world's supply, but a sharp surge in crude prices lifted beaten-down energy stocks and kept losses in check. The attack on the world's biggest oil exporter sent oil prices up more than 20% before they eased off their peaks as various nations said they would tap emergency reserves to ensure stable supplies

Reuters September 17, 2019 00:05:37 IST
Wall Street hit by Saudi attacks; energy stocks temper losses

Wall Street hit by Saudi attacks energy stocks temper losses

By Medha Singh and Ambar Warrick

(Reuters) - U.S. stocks fell on Monday on global growth worries after weekend attacks on Saudi Arabia's crude facilities hit 5% of the world's supply, but a sharp surge in crude prices lifted beaten-down energy stocks and kept losses in check.

The attack on the world's biggest oil exporter sent oil prices up more than 20% before they eased off their peaks as various nations said they would tap emergency reserves to ensure stable supplies.

The S&P 500 energy, one of the worst performing sectors so far this year, soared 3.15%, looking at its best one-day gain since Jan. 4. Shares of Apache Corp, Marathon Oil Corp and Hess Corp jumped between 10% and 13% and were the leading gainers on the benchmark index.

"The oil spike - higher prices globally - could slow world spending on items other than oil and that's the main concern," said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

Market spotlight shifted to the drone attacks from this week's centerpiece, the U.S. Federal Reserve's two-day monetary policy meeting where expectations of a quarter point interest rate cut remain high.

Anticipation of higher fuel costs drove down shares of airlines and cruise line operators with the S&P 1500 airlines shedding 2.20% while Carnival Corp fell 2.8%.

Retail stocks lost 1.38% and were among the biggest drags on the S&P 500.

"The drone strike in Saudi has had an impact on how investors are looking at the security and stability of the global energy supply chain and is fueling a degree of risk reassessment," said Peter Kenny, founder of Kenny's Commentary LLC and Strategic Board Solutions LLC in New York.

Shares of defense companies Raytheon, Lockheed Martin Corp, Northrop Grumman Corp rose at least 2%. J.P. Morgan upgraded Raytheon shares to "overweight".

At 12:57 p.m. ET, the Dow Jones Industrial Average was down 151.30 points, or 0.56%, at 27,068.22, the S&P 500 was down 12.58 points, or 0.42%, at 2,994.81. The Nasdaq Composite was down 32.63 points, or 0.40%, at 8,144.08.

Nine of the 11 major S&P sectors were trading lower.

Investors' flight to safety pulled the U.S. benchmark 10-year Treasury bond yields down from their multi-week highs, sending the interest-rate sensitive bank sub-sector 0.72% lower.

Wall Street's more than a decade-long rally continues to hinge on whether the Fed will keep cutting interest rates and on the progress in U.S.-China trade talks. The recent easing in trade tensions has brought the benchmark S&P 500 about 1% below its record high.

Among other movers, General Motors Co fell 4.1% after the United Auto Workers went on strike on Sunday, the first nationwide strike at GM in 12 years.

Advancing issues outnumbered decliners for a 1.09-to-1 ratio on the NYSE and a 1.18-to-1 ratio on the Nasdaq.

The S&P index recorded five new 52-week highs and one new low, while the Nasdaq recorded 41 new highs and 22 new lows.

(Reporting by Medha Singh and Ambar Warrick in Bengaluru; Editing by Saumyadeb Chakrabarty, Arun Koyyur and Shounak Dasgupta)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Airline easyJet's first-half loss widens as COVID-19 hurts travel, seeks cash
Business

Airline easyJet's first-half loss widens as COVID-19 hurts travel, seeks cash

(Reuters) - Budget airline easyJet on Wednesday reported a bigger loss for the first half as it took a 160-million-pound hit ($199 million) from failed fuel hedging as the COVID-19 pandemic brought global air travel to a virtual standstill. The London-listed company reported a pretax loss of 353 million pounds for the six months ended March 31 from a loss of 272 million pounds last year. Revenue rose 1.6%, though easyJet took a hit from strikes in France, and storms Ciara and Dennis.

Bayer settles Roundup cancer lawsuits for up to $10.9 billion
Business

Bayer settles Roundup cancer lawsuits for up to $10.9 billion

FRANKFURT (Reuters) - Bayer AG on Wednesday said it agreed to settle U.S.

Sudan to establish trade financing fund in face of forex shortage
Business

Sudan to establish trade financing fund in face of forex shortage

KHARTOUM (Reuters) - Sudan will create a trade financing fund with a portfolio of $2 billion to aid the import and export of key commodities such as wheat, the Finance Ministry said, as the supply of foreign currency in circulation dwindles. Sudan's economy is at risk of freefall, hammered by an inflation rate of more than 100% and frequent shortages of bread, fuel and medicine. The country's currency has also fallen to a record low of 150 Sudanese pounds to the dollar on the black market compared with 55 at the official rate