Summary US stocks followed European equity markets lower in early trade Friday on worries about plunging oil
NEW YORK: (AFP) - US stocks followed European equity markets lower in early trade Friday on worries about plunging oil prices.
About 35 minutes into trade, the Dow Jones Industrial Average stood at 17,528.02 down 68.32 points (0.39 percent).
The broad-based S&P 500 fell 6.93 (0.34 percent) to 2,028.40, while the tech-rich Nasdaq Composite Index declined 6.84 (0.15 percent) to 4,701.32.
Oil prices have dropped nearly 50 percent since June. Although lower prices mean consumers have higher disposable income, analysts have expressed anxiety at the speed of the decline.
Oil fell again Friday after the International Energy Agency slashed its demand forecast. "The IEA news isn t exactly a shocker, yet it is feeding into concerns that oil prices will continue to slide, raising the specter of margin calls, debt repayment difficulties, and social unrest in countries heavily reliant on oil export revenue," said Briefing.com analyst Patrick O Hare.
Shares of oil and oil service companies continued to fall. Dow component Chevron dropped 1.3 percent, while leading shale producer Continental Resources and driller Nabors Industries both lost 3.5 percent.
United Technologies dropped 0.6 percent after it projected 2015 earnings of $7.00-$7.20 per share, below the $7.27 estimated by Wall Street analysts.
Software company Adobe Systems shot up 7.5 percent as fourth-quarter earnings jumped 12.2 percent to $73.3 million on strong cloud-computing subscriptions.
Bond prices rose. The yield on the 10-year US Treasury fell to 2.13 percent from 2.18 percent Thursday, while the 30-year declined to 2.79 percent from 2.83 percent. Bond yields and prices move inversely.
