US shares ended lower on Wednesday, dragged down by a glut in oil inventories which sent the price of the fuel to its lowest levels since December.
The S&P 500 ended down 0.2% at 2363 and just off the intraday low, while the Dow Jones Industrial Average had to make do with down 0.3% at 20,855.
The Nasdaq Composite was the standout, finishing up 0.06% at 5837.
Oil prices slid more than 5.7% during the session following data showing a surge in US crude inventories from the EIA to another record high, breaking the narrow range the energy price has been trading in since late 2016.
The US energy department reported a ninth consecutive rise in crude stockpiles, which last week jumped by 8.2mln barrels, triggering a sell-off in both major benchmarks that plunged to the lowest level since December.
US oil price benchmark West Texas Intermediate - at one point as low as $50.05 intraday - dropped by $2.94 a barrel to $50.20 while the global Brent benchmark fell $2.92 to $53.
But overall, the biggest faller on the S&P 500 was Marathon Oil (NYSE:MRO) down 8.7% to $14.86 and leading a chorus of oil stocks lower. Second in line was Murphy Oil (NYSE:MUR) down 6.7%, and Devon Energy (NYSE:DVN) down 6.5%. The top eight decliners were all energy stocks with percentage losses closely clumped together.
The S&P Smallcap 600 closed down 0.7% at 831 and led by engineering services company Team Inc (NYSE:TISI) down 14.5% to $27.10 a day after reporting earnings results that missed analysts estimates.
US shares were mixed on Wednesday, as the S&P 500 and Nasdaq Composite firmed, but the Dow Jones Industrial Average gave up initial gains while energy stocks nursed losses after more US data reinforced worries about an oil glut.
The bellwether S&P 500 broke a two-day losing streak as a stronger-than-expected ADP report on private sector job growth prompted investors to mark up interest rate hike expectations and fuelled bank stock gains.
The S&P 500 added 0.1% to 2,371, with the financial sector – up 0.7% – leading the gains who stand to gain from higher interest rates.
The Nasdaq Composite rose 0.4% to 5,857 but the Dow Jones Industrial Average was softer at 20,915.
Leading the charge higher by the S&P 500 index was tax adviser H&R Block (NYSE:HRB), up 15.2% to $24.00 after it reported results that beat Wall Street expectations. Before the opening bell shares were already up 7%.
The S&P Midcap 400 was down 0.1% at 1717 and led by telecom equipment maker Ciena Corp (NYSE:CIEN), down 8.1% at $24.04 after earnings fell 3 cents a share shy of estimates, with adjusted quarterly profit of 26 cents per share. Revenue also missed forecasts.
The next few top fallers on the S&P 400 were all oil companies after Inventories of US crude advanced for the ninth consecutive week, the longest streak of gains since 2015.
Stockpiles of US crude climbed by 8.2mln barrels in the week ended March 3, and have risen every week this year, according to the latest data from the Energy Information Administration. That eclipsed estimates for a 1.3mln-barrel build.
But the top faller in the S&P 500 was retailer Urban Outfitters (NASDAQ:URBN) down 5% at $24.15 after it posted lower-than-expected earnings, when the company reported fourth-quarter fiscal 2017 results. Further, the company’s top-line fell short of the Zacks Consensus Estimate for the second consecutive quarter.
The S&P Smallcap 600 was down 0.07% at 836 and led by another retailer, Express Inc (NYSE:EXPR) down 11.4% to $9.45. The apparel seller matched Street forecasts with a quarterly profit of 29 cents per share, and revenue beat estimates. However, same-store sales fell 13%, more than the 12% consensus estimate. The company said its performance was impacted by slower mall traffic and a promotional retail environment.
US shares are expected to open firmer on Wednesday after a jobs data surge and buoyant earnings data.
The S&P 500, Nasdaq Composite as well as the Dow Jones Industrial Average, which earlier this week fell below its new 21,000 milestone level, will be edge higher.
Markets will get a lift from jobs data and some earnings news, although not by enough to chalk any fresh record highs the likes of which we have seen steadily since November.
Wall Street will be hoping for a chip off the old block for index gains after payrolls and tax adviser H&R Block (NYSE:HRB) reported results that beat Wall Street expectations. Its shares jumped by 7% to $22.29 pre-market and if the weight of index falls isn’t large, expect more upside early in the session.
Now data. Anticipation is building on Wall Street ahead of Friday's monthly jobs report. Continued payroll growth could give the US Federal Reserve confidence to raise interest rates later this month.
On Wednesday, that torch was lit as the latest private sector jobs data from ADP was released showing that in February employment expanded by 298,000 versus a forecast of just 190,000. In January the tally was 261,000.
The non-farm payrolls are released a week later than normal. Customarily the numbers are released on the first Friday of the month. The market consensus is for 190,000 jobs created, which would be weaker than January’s 227,000.