Wall Street stretched losses in afternoon trade as oil resumed its slump and as investors awaited key inputs on economic growth.
At the close, the Dow Jones Industrial Average (INDEXDJX:.DJI) had fallen 208 points to 15,885. The S&P 500 (INDEXSP:.INX) was down 30 points at 1,877, while the Nasdaq Composite (INDEXNASDAQ:.IXIC) dropped 73 points to 4,518.
Light, sweet crude for March delivery settled down 5.7% to $30.34 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell 5% to $30.56 a barrel on ICE Futures Europe.
A batch of earnings reports, data and the Federal Reserve's statement are all due later in the week.
Consumer confidence is due on Tuesday, ahead of consumer sentiment and fourth-quarter GDP on Friday.
Wall Street ends two-day rally as oil tumbles again
Also in focus is the Federal Reserve meeting on Tuesday and Wednesday, as well as the Bank of Japan's meeting later in the week.
Wall Street snapped a two-day advance on Monday as oil prices tumbled again.
At 12:50 p.m. in New York, the Dow Jones Industrial Average (INDEXDJX:.DJI) retreated 0.3% to $16,044.27. The S&P 500 (INDEXSP:.INX) retreated 0.5% to 1,897.39. The Nasdaq Composite (INDEXNASDAQ:.IXIC) skidded 0.3% to 4,576.79.
Brent crude tanked 4.1% to $30.86 a barrel following a 10% rise on Friday, while US oil shed 4.7% to $30.68. The slump came as the head of Opec called for all oil-producing nations to work together.
The correlation between oil prices and stocks has been high since last month.
All eyes will be on the U.S. Federal Reserve's next move on interest rates when the Federal Open Market Committee meets on January 26-27.
McDonald’s (NYSE:MCD) rose 1.3% to $119.95 after fourth-quarter profit and revenue soundly beat analysts’ expectations. All-day breakfast helped drive the company’s best quarterly results in the U.S. in nearly four years.
Tyco (NYSE:TYC) surged 10.5% to $33.80 after the fire protection and security products maker agreed to merge with Johnson Controls.
Twitter (NYSE:TWTR) fell 3.8% to $17.17. An exodus of executives has raised concerns about the microblogging company’s plans to win more users.
Caterpillar (NYSE:CAT) dropped 4.1% to $58.50 after Goldman Sachs cut its rating on the stock to "sell". The stock was the biggest drag on the Dow.
ConocoPhillips (NYSE:COP) sank 5.7% to $35.54 after Barclays said the oil and natural gas producer should cut its dividend by 75%.
Wall Street opens lower as crude continues to distract
It is shaping up to be another down day as crude prices distract from the earnings season.
WTI crude dipped around 3% to US$31.25, while Brent was down 2.5% to US$31.40.
The Dow Jones began on the back-foot, giving up nearly 0.5% or 0.29%, to 16,047 while the S&P 500 and Nasdaq fell 0.7% and 0.5% respectively.
Wall Street futures point to lower start on Monday
Pre-market indicators point to a negative start to the week’s trading on Wall Street as crude oil’s continued demise provides the backdrop for earnings season.
West Texas Intermediary crude headed back towards US$31 per barrel with a 3.6% fall early on Monday morning, meanwhile Brent slipped 3.3% to US$31.15.
Traders also have half an eye on the Federal Reserve which is due to release a statement on Wednesday, following December’s interest rate rise.
Dow Jones futures were down some 55 points changing hands at around 1,594, while the S&P 500 and Nasdaq futures also fell.
As company reporting steps up markedly this week, the morning’s highlights come from McDonald’s (NYSE:MCD), Halliburton (LON:HAL) and Kleenex owner Kimberly-Clark (LON:KMB) all of which have results out ahead of the opening bell.
Twitter shares are expected to open on the back-foot after chief executive Jack Dorsey announced that the revolving door on the social media group’s boardroom continues to spin. Four senior company executives including senior VP of engineering are leaving, Dorsey revealed over the weekend via his Twitter account.
Tyco (NYSE:TYC) is another one to watch in early deals, following reports that the security systems firm is a US$20bn takeover target for Johnson Controls (NYSE:JCI).