Oil and gas stocks led Wall Street lower, outweighing a recovery for technology stocks, in an otherwise bruising session for equities that at one point saw the S&P 500 enter correction territory and the Nasdaq Composite turn negative for the year.
Fuelled by a more than 6 per cent tumble in the price of oil, losses widened for the energy sector and weighed more heavily on the Dow Jones Industrial Average, which carries a larger weighting to such names.
The S&P 500 finished 1.8 per cent lower, and the Nasdaq Composite shed 1.7 per cent. The Dow Jones Industrial Average dropped 2.2 per cent with all 30 of its members closing lower.
All S&P 500 sectors finished in the red. Energy was the worst of the lot, down 3.3 per cent, followed by telecommunications services, down 2.5 per cent, and consumer discretionary, down 2.3 per cent.
Utilities, down 0.5 per cent, healthcare, down 0.9 per cent, and technology, down 1.4 per cent, were the best performers.
Retailers were hit hard, with earnings, outlooks and dividend cuts from Target, Kohl’s and L Brands, respectively, worrying investors. Those three companies were down 10.5 per cent, 9.2 per cent and 17.7 per cent, respectively.
In afternoon trade, Brent crude, the international oil marker, was down 6.7 per cent at $62.31 a barrel, while West Texas Intermediate, the US benchmark, was off 7.1 per cent at $53.16.
Despite the hefty falls for stocks, Treasuries received only mild support. By the afternoon, bonds were in declines as yields reversed direction and trudged higher. The yield on the benchmark 10-year US Treasury was up 0.4 basis points to 3.0628 per cent.
The dollar firmed, with the DXY index up by about ⅔ of 1 per cent to 96.817.
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