Monday, June 24, 2024

Energy stocks lead major indexes lower in early US trading

by Associated Press

Stocks are opening lower on Wall Street, with energy companies logging some of the biggest losses as oil prices take another turn lower. The S&P 500 index was off 0.2% in the first few minutes of trading Monday, and the Nasdaq was down by a similar amount. Benchmark U.S. crude oil was down 2.9% to just over $66 a barrel, following a decline of 7.7% last week. That helped pull energy companies lower. Occidental Petroleum lost 2.3%. Companies are still turning out their latest quarterly earnings reports. Tyson Foods climbed 4.9% after turning in a strong report card. Bond yields held steady.

European stocks opened lower and Asian markets advanced Monday after U.S. hiring improved and China and Australia tightened anti-virus controls that threaten to weigh on an economic recovery.

London and Frankfurt declined in early trading. Shanghai and Hong Kong closed higher. Japanese markets were closed for a holiday.

Wall Street futures were lower after the S&P 500 benchmark ended last week at a new high following government data showing American employers added more jobs in July than expected.

Investors have been encouraged by higher U.S. corporate profits and the global increase in coronavirus vaccinations. But the delta variant’s spread has prompted some governments to reimpose controls on business and travel.

China has canceled airline flights as it tries to stop a rash of outbreaks. Australia’s two most populous states have told the public to stay home except to go to work or for a handful of other reasons.

“The right question for everyone to be asking, including financial market participants, is when lockdowns will come to other economies,” Carl B. Weinberg of High Frequency Economics said in a report. “This is central bankers’ worst nightmare coming true.”

In early trading, the FTSE 100 in London fell 0.3% to 7,100.82 and the DAX in Frankfurt shed 0.1% to 15,743.00. The CAC 40 in Paris was little changed at 6,815.40.

On Wall Street, futures for the S&P 500 and the Dow Jones Industrial Average were down 0.2%.

On Friday, the S&P 500 index rose 0.2% and the Dow added 0.4% after the Labor Department reported employees added 943,000 workers in July, well above forecasts, and wages rose. The S&P 500 ended up 0.9% for the week.

Economists said the report will give the Federal Reserve another reason to reduce bond purchases that inject money into the financial system.

The Nasdaq fell 0.4% to 14,835.76.

In Asia, the Shanghai Composite Index gained 1.1% to 3,494.63 after Chinese exports rose 18.9% in July over a year earlier. The country’s global trade surplus was $56.6 billion.

Hong Kong’s Hang Seng gained 0.4% to 26,283.40. The Kospi in Seoul fell 0.3% to 3,260.42 and the S&P-ASX 200 in Sydney ended little changed at 7,538.40.

India’s Sensex rose less than 0.1% to 54,310.95. New Zealand and Jakarta declined while Bangkok gained.

China has cut off most access to a city of 1.5 million people, canceled airline flights and told the public to avoid travel if possible after a spate of cases that were tied to travelers from overseas who were infected with the delta variant.

Australia’s central bank governor, Philip Lowe, warned Friday the economy is likely to shrink in the quarter ending in September after health emergencies were declared in New South Wales, where populous Sydney is located, and Victoria, with Melbourne and major companies.

In energy markets, benchmark U.S. crude tumbled $2.75 per barrel to $65.53 in electronic trading on the New York Mercantile Exchange. The contract fell 81 cents on Friday to $68.28. Brent crude, the price standard for international oils, dropped $2.67 to $68.03 per barrel in London. It fell 59 cents the previous session to $70.62.

The dollar edged down to 110.18 yen from Friday’s 110.23 yen. The euro slipped to $1.1756 from $1.1758.

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