Wall Street lower as investors turn cautious; Apple drags

Apple dragged Wall Street lower on Tuesday, cutting short a feeble recovery from a bruising selloff on the first trading day of the year.

A fall in crude oil prices and a stronger dollar also contributed to the shaky start to the year, which was triggered by weak Chinese economic data on Monday.
In a bid to stabilize its markets, the People's Bank of China on Tuesday injected $20 billion into the financial system.

"Fears of a global recession are valid and fears about China are valid, and they will put some downward pressure on stocks in general, so I do expect 2016 to be negative, but not by much," said Mohannad Aama, managing director, Beam Capital Management in New York.

Apple's shares were down 2.5 percent at $102.68 after the Nikkei reported that the iPhone maker was expected to cut production of its 6S and 6S Plus models.

The stock was the biggest drag on the S&P 500 and the Nasdaq, while Goldman Sachs weighed the most on the Dow.

At 12:30 p.m. ET (1730 GMT), the Dow Jones industrial average was down 86.84 points, or 0.51 percent, at 17,062.1, the S&P 500 was down 5.71 points, or 0.28 percent, at 2,006.95 and the Nasdaq Composite index was down 23.04 points, or 0.47 percent, at 4,880.05.

Six of the 10 major S&P sectors were lower, led by a 0.87 percent decline in the energy sector. Exxon and Chevron weighed the most.

Gilead rose 0.9 percent to $98.89 after its experimental hepatitis B drug was found safer than but as effective as its approved treatment, Viread.

Eli Lilly reversed course to trade up 1 percent at $83.66 after the drugmaker said its diabetes treatment grabbed market share in the fourth quarter.

First Solar was up 6.8 percent at $71.20 after Goldman Sachs upgraded the stock to "buy".

Declining issues outnumbered advancing ones on the NYSE by 1,538 to 1,453. On the Nasdaq, 1,529 issues fell and 1,178 rose.

The S&P 500 index showed three new 52-week highs and five new lows, while the Nasdaq recorded 14 new highs and 43 lows. — Reuters

Oil prices extend gains in Asian trade

Singapore – Oil prices climbed in Asia Monday boosted by a weaker dollar and expectations a rise in demand will ease a global supply glut, while investors await the release of key Chinese economic data this week.

Both main crude contracts have rallied since hitting six-year lows in late August, with last week seeing healthy rallies in line with global equities on waning expectations the US Federal Reserve will hike borrowing costs this year, pushing the dollar lower.

A softer dollar makes dollar-priced oil cheaper, spurring demand.

Comments by OPEC secretary general Abdullah el-Badri at the weekend that the cartel sees a "more balanced" oil market next year also provided support.

In afternoon Asian trade, US benchmark West Texas Intermediate for November delivery rose 0.89 percent to $50.07 and Brent crude for November added 0.91 percent to $53.13 a barrel.

Attention is on the release of Chinese trade and inflation data, which will give a fresh idea about the state of the world's biggest energy consumer. Confidence was given a lift at the start of the month by a report indicating the country's key manufacturing sector saw a slight improvement in September.

The news provided some cheer after a string of figures highlighting a sharp slowdown in Chinese growth. Fears about the Asian economic giant were inflamed in August when authorities devalued the yuan currency, raising questions about their grip on the crisis.

Bernard Aw, market strategist at IG Markets Singapore, said Monday's price rise was bolstered after el-Badri said Sunday: "OPEC is confident that it will see a more balanced market in 2016.

 "In recent months, there has been a contraction in production from non-OPEC producers and an increase in global demand."

The comments meant the oil producers' cartel – which accounts for about 40 percent of global production – "still sees stronger demand in the medium term", Aw told AFP.

Despite the recent uptick, oil prices remain depressed owing to concerns about demand as the global economy stutters, a supply glut and the weakness in China. – Agence France-Presse

source: gmanetwork.com