There was a distinct lack of, well, energy in Tuesday’s trading session.
Major indices closed down on the day, with the energy sector leading the decline following comments from Saudi Arabia’s energy minister signalling that emboldened US shale developers may undermine efforts to shore up oil prices.
The Dow Jones Industrial Average shed 0.15 per cent from the open to close at 20,923, and the S&P 500 and Nasdaq each followed with declines of approximately 0.3 per cent apiece, to 2,368 and 5,833 respectively. Some of the biggest laggards of the day were energy companies, with that sector falling about 0.9 per cent on both the Dow and S&P 500.
The falls come amid a flurry of news out of the CERAWeek by IHS Markit conference, a gathering of the global energy who’s-who in Houston, Texas. Saudi Arabia’s energy minister Khalid al-Falih told executives that his country’s participation in an international agreement to cut crude output was reinvigorating rivals in the US shale patch, the FT reported, a development that could undermine efforts to stabilise a weak oil market.
Healthcare shares also failed to regain much of the ground they lost earlier in the day following a tweet from President Donald Trump declaring yet again his intention to bring down drug prices.
The global Brent benchmark price declined 0.2 per cent on the day to $55.88 a barrel, while the US benchmark West Texas Intermediate down about the same amount, to $53.10.
The dollar was also gaining ground for the second straight day, climbing 0.14 per cent to 101.78. The 10-year Treasury note saw yields tick up 1.1 basis points to hit a yield — which moves in the opposite direction of its price — of 2.51 per cent.