NEW YORK: US stocks were lower after GE shares plunged for the second straight day and a drop in oil prices hit energy stocks.
The industrial conglomerate was on track to record its worst two-day fall since 2009 after its new chief executive on Monday outlined steps to turn it into a smaller, more focused company, surprising some investors. Oil prices fell almost two per cent as bullish factors such as ongoing OPEC-led production cuts and Middle East tensions were countered by rising US output.
Exxon slipped 0.7 per cent and ConocoPhillips was down 2.5 per cent, weighing the most on the S&P energy index .With the quarterly earnings season winding down, the market has taken a breather after its rally to record highs last week.
“There are no catalysts at the moment, while there are concerns that the Federal Reserve is going to get more ammunition to move higher with interest rates,” said Jeff Zipper, managing director for investments at Private Client Reserve at US Bank in Palm Beach, Florida.
“Flattening yield curve is certainly a concern for the market. The market is not convinced that we’re going to get the growth that we need to steepen the yield curve.”
A tightening gap between short- and long-term US government bond yields suggests the Fed may be in danger of hiking rates too much and killing longer term inflation and growth.
Tthe Dow Jones Industrial Average was down 30.23 points, or 0.13 per cent, at 23,409.47, the S&P 500 was down 5.97 points, or 0.23 per cent, at 2,578.87 and the Nasdaq Composite was down 19.72 points, or 0.29 per cent, at 6,737.87.
