US stocks staged a comeback late on Thursday to pare losses and close soft after over-sold utilities led the charge on the benchmark S&P 500 index.
The S&P 500 closed down 0.3% at 2132 led by Cabot Oil & Gas Corp (NYSE:COG), down 4.7% to $22.75.
Earlier, commodities and other stocks nursed hefty losses across the DJIA as well as S&P following China’s release of exports data which showed a 10% slump in September. Analysts had expected a 3% decline.
That roiled Asian, European and eventually US bourses.
The S&P Midcap 400 closed down 0.4% at 1519 while the S&P Smallcap 600 ended down 1.1% at 737.
The S&P 500 and Nasdaq Compsitite both posted their lowest closes in a month, but the resilience of the market was best told by the Dow, which at one point had been down 170 points on the day but finished down 45 points, or 0.3%, at 18,098, regaining 18,000 territory.
Early trading
US shares fell sharply early on Thursday after resources stocks were hit in the wake of sharply lower Chinese exports which sent the Dow below 18,000 for the first time in more than three months.
Investors dashed into defensive assets, with the US utilities, real estate, healthcare and telecommunications sectors avoiding the brunt of Thursday’s selling. More economically-sensitive financials, materials and energy groups were hard hit.
The 10% drop in September exports by the world’s second-biggest economy was more than three times the pace economists expected and was expected to hurt US commodities stocks huddled in the Dow index.
The Dow Jones Industrial Average was down 168 points, or 0.9%, at 17,976. On a closing level basis, the last time it dipped below 18000 was on 7 July. The index was led lower by the likes of oil groups Chevron (NYSE:CVX) down 2.1% at $100.02 as well as Exxon (NYSE:X="" rel="6780" united-states-steel-="">NYSE:XOM).
But Chevron held joined first place among fallers with investment bank Goldman Sachs (NYSE:GS), down $165.77, feeling the pinch of technical trading as well as news that overnight Wells Fargo (NYSE:WFC) Chief Executive Officer John Stumpf announced his retirement, effective immediately, following the sales practices scandal that's engulfed the bank over the past few weeks. Wells Fargo shares were down 1.9% at $44,47.
Meanwhile, the S&P 500 market bellwether was also down 0.9% at 2118 and led lower by oil group Freeport-Mcmoran Inc (NYSE:FCX) down 6.8% at $9.37.
The hit was harder among smaller stocks, however.
The S&P Midcap 400 was 1% lower at 1510 and led south by Deckers Outdoor Corp (NYSE:DECK) down 7.1% to $56.61 and United States Steel Corp (nyse:x) down 6% at $16.45.
The S&P Smallcap 600 was down 1.2% at 736 and led by electronics goods maker Cubic Corp (NYSE:CUB) down 11.2% to $40.00 after reporting fiscal 2016 results that disappointed.
Pre-Open
The Dow Jones average is in danger of a triple-digit tumble when trading starts this morning after some shocking Chinese trading figures.
Chinese exports in September were 10% lower than they were a year earlier, confounding economists, who had been expecting a more modest fall of around 3%.
The news is likely to prompt a wave of selling in the resources sector, which would take its toll on the Dow Jones.
The 30-share index closed at 18,144 last night, and according to spread betting sites is likely to open its account today at around 18,044,
The broader-based S&P 500 is pegged to open at 2,126, down 13 points on last night’s close.
One stock set to defy the trend is scandal-hit bank Wells Fargo & Co (NYSE:WFC), which was up 1.1% in pre-market trading, as under fire boss John Stumpf read the writing on the wall – eventually – and announced his retirement.
Read Stumpfounded! Wells Fargo hits boss Stumpf in the pocket
Stumpf had US$41mln of stock options clawed back in the wake of a sales scandal at Wells Fargo. Around two million fake accounts were created by the bank, as employees attempted to hit demanding sales targets. Stumpf was grilled by the Senate Banking Committee last week over the practices, which had prompted a US$185mln fine and regulatory action.
Metal manufacturer Alcoa Inc (NYSE:AA) was sagging in screen-based trading ahead of the bell after Tuesday night’s disappointing earnings update. The shares were down 2.6%, adding to yesterday’s losses.
Investors got on board CSX Corporation (NASDAQ:CNS), the rail services provider, after its quarterly earnings, released last night, topped analysts’ forecasts. Earnings per share of 48 cents were three cents higher than analysts had expected.