Stocks slide as oil prices fall again
NEW YORK - Stocks are falling sharply in midday trading, led by more declines in energy and materials stocks as prices for oil and other commodities slide. Chevron lost 3 percent. The drops follow sharp declines in European markets.
The Dow Jones industrial average lost 322 points, or 1.8 percent, to 17,253 as of 3:19 p.m. ET. The Standard & Poor's 500 index gave up 41 points, or 2 percent, to 2,012. The Nasdaq composite fell 108 points, or 2.1 percent, to 4,938.
All 10 industry sectors of the S&P 500 fell, led by a 2.5 percent drop in energy shares.
The price of oil fell further after the International Energy Agency said that oversupply would continue until late next year and demand would weaken. Benchmark U.S. crude dropped 92 cents, or 2.5 percent, to $35.84 a barrel in New York. Oil has been falling for 1 ½ years and is now at its lowest level since early 2009.
Though the drop in oil can help consumers and businesses by cutting their energy bills, the recent decline has been weighing on stocks as investors worry it is a sign of a weak global economy. The low oil price has also decimated profits at energy companies.
France's CAC 40 shed 1.4 percent and Germany's DAX lost 1.9 percent. Britain's FTSE 100 dropped 1.8 percent.
Dow Chemical and DuPont are giving up gains earlier this week after they confirmed their widely anticipated $130 billion deal to merge their businesses. The new company is due to split into three parts, one focused materials, one on agriculture and the last on specialty products. Dow Chemical fell $2.31, or 4 percent, to $52.60. DuPont lost $4.15, or 5.6 percent, to $70.40.
Retail sales grew 0.2 percent in November, an improvement compared to August-October. Consumers spent more money on apparel, sporting goods and electronics and online retailers did better. Department store sales were flat.
Investors are also focused on a two-day policy meeting at the Federal Reserve, which wraps up Wednesday. Policymakers are widely expected to announce that they're raising key interest rates from their record low levels. Recent economic reports indicate that the U.S. economy is healthy enough to withstand a rate hike.
Investors are cautious ahead of a batch of monthly economic data expected on Saturday, including retail sales, fixed asset investment and industrial production. Further out, a report on foreign direct investment in China is due on Wednesday. The latest figures will provide an update on the world's second biggest economy, which is struggling with a stubborn downturn.
Japan's Nikkei 225 index climbed 1 percent, but most other major indexes in Asia were down. South Korea's Kospi lost 0.2 percent, Hong Kong's Hang Seng slipped 1.1 percent and mainland China's Shanghai Composite lost 0.6 percent. Australia's S&P/ASX 200 dipped 0.2 percent.
U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 2.17 percent from 2.23 percent on Thursday. The dollar fell to 121.23 yen from 121.64 yen. The euro strengthened to $1.0966 from $1.0939.