US Stocks Extend Drop as Oil Falls Below $37
New York (Dec 28) Stocks extended their drop by mid-morning Monday as a selloff in Chinese equities dragged on the energy sector.
The S&P 500 (SPY) fell 0.6%, the Dow Jones Industrial Average (DIA) declined 0.47%, and the Nasdaq (QQQ) slipped 0.71%.
Chinese markets were a massive drag on U.S. equities after another monthly decline in profits at Chinese industrial companies. Profit fell 1.4% from a year earlier, marking a sixth straight month of decline and fueling fears over the health of the world's second-largest economy. The Shanghai Composite tumbled 2.6%, its biggest one-day decline since late November. European markets pulled lower with Germany's DAX down 0.45% and the CAC 40 in France falling 0.93%.
Must Read: China Faces 2016 Crisis as Bad as U.S. Mortgage Meltdown
Crude oil prices were under pressure over fears about international demand triggered by the Chinese selloff. West Texas Intermediate crude oil fell 3.5% to $36.76 a barrel. Energy shares including Exxon Mobil (XOM - Get Report) and Chevron (CVX - Get Report) pulled lower. The Energy Select Sector SPDR ETF (XLE) fell 1.6%.
Market activity was volatile last week in low-volume trading during the holiday season. The number of shares traded on the S&P 500 in the past several sessions reached just a fraction of its three-month daily average of nearly 700 million. Trading this week is likely to follow a similar pattern, with markets closed on Friday for New Year's Day.
Apple (AAPL) has asked Samsung Electronics (SSNLF) to pay $180 million in damages from a recently-settled patent case. Samsung has already agreed to pay $548 million for infringing upon Apple's smartphone patents.
General Electric (GE) was slightly lower after winning a contract in China to provide half the generation capacity of a hydropower project in China. GE's contract is a smaller part of a 100 billion yuan project ($15.5 billion) on the Jinsha River.
Disney's (DIS - Get Report) Star Wars: The Force Awakens reached the billion-dollar mark at the global box office on Sunday. The milestone made it the fastest-grossing film in history, only 12 days after its debut. The movie has yet to open in China, the world's second-largest movie market. Jurassic World had previously held the record.
FedEx (FDX - Get Report) drew ire from customers after delays made a number of deliveries late for Christmas. The delivery service has contended with severe weather interruptions, particularly at its major air hub in Memphis. FedEx ran extra shifts on Christmas Day to clear the delivery backlog. Shares were down 1.3%.
Amazon (AMZN - Get Report) announced a record-breaking holiday for its Prime delivery service, which also provides video and other perks to members. The tech giant announced that more than 3 million people joined Prime in the third week of December, while 200 million items were delivered to subscribers.
Pep Boys (PBY) has agreed to a $947 million bid from Bridgestone after contemplating an offer from activist investor Carl Icahn. The auto shop chain said the offer from Icahn Enterprises (IEP) was no longer a "superior proposal." Bridgestone will pay $17 a share.
Source: TheStreet
