US stocks closed with a loss on Monday, Oil prices dropped sharply
Source : Tickmill Market CommentaryUS stocks failed to finish Monday trading session in a green zone. Dow Jones declined by 0.66% or 117.12 points to 17730.51 points. S&P500 lost 14.62 points (0.7%) to 2077.07 points. Nasdaq Composite tumbled by 0.79% (40.46 points) to 5101.81 points.
Daily volume averaged 7.4B shares which exceeds an average daily volume by 4.8% in the last three months.
Market Cap of Chevron Group (N:CVX) and Exxon Mobil Corp (N:XOM) dropped by 2.6% on the news that OPEC won’t limit their production volumes.
WTI prices steeply declined by 5.8% to $37.65/bbl. after a 2.7% decline on Friday. The fall was caused by OPEC’s resolution to maintain the output quota on the same level at 31.5M bbl. daily. OPEC members agreed to work uncapped, which basically means that there are no limits for production until the next meeting in June 2016.
Seven out of ten sectoral groups from S&P500 plunged on Monday following the Oil and commodity companies. The stocks of consumer and communication companies rose at the same time.
Shares of Consol Energy and William Co’s sharply dropped by 13%.
Market cap of the copper-production company, Freeport-McMoRan, lost 7.9% on Monday which became the biggest drop for the last two months.
Shares of JetBlue Airways, Delta Air Lines, and United Continental air carriers rose by more than 2.6%. A drop in Oil prices will positively impact the financial health of air carriers as fuel is the main part of their expenses.