Wall St drops as oil price continues to descend

[Editor: When the Crude Oil is falling showcasing an impending slowdown of Global Economy (though many say it is due to some other extraneous factors like shale gas boom and cold war between Saudi Arabia and US), and both the CPI and IIP falling from grace, what is the RBI Governor doing? Trying to justify, whether Narendra Modi is right on wrong, in chalking out plans to make India a Manufacturing Hub? Silly!! If the highly qualified governor of the RBI starts analyzing Narendra Modi's pedestrian rhetorics, which are basically aimed towards "Mass (Public) consumption", then what to say!! However, I feel if the Repo rates are not cut immediately and the government fails to come up with quick measures to boost the Indian Economy, we might slip into a prolonged recession. The FII data and the direction of Nifty is what is likely to rattle both the RBI and the GOI in the next week]

NEW YORK - U.S. stocks fell on Friday, putting the benchmark S&P 500 on track for its first weekly decline in eight, following a further drop in oil prices and disappointing data out of China, the world's second-biggest economy.

The S&P index had broken a three-day skid on Thursday, buoyed by upbeat retail sales figures and other data that pointed to a strengthening U.S. economy, but finished well off its session highs as oil prices slipped.

Weak oil prices have added to worries about global demand and raised concerns about earnings for some energy companies, with year-end tax selling putting more pressure on the group. In addition, continued weakness in oil prices has prevented investors from bargain hunting the sector.

"It’s a time when most managers have underperformed their benchmarks so rather than stepping up to the plate on these stocks, they are avoiding them because they are trying to play catch up," said Terry Morris, senior equity manager for National Penn Investors Trust Company in Reading, Pennsylvania.

"'Don’t try to catch a falling knife' – that’s what you have here."

The S&P energy sector was down 1.4 percent for the session and is down about 16 percent this year as the worst performing of the 10 major S&P sectors.

Disappointing data that indicated China's economy showed further signs of softening in November weighed on the materials sector, which dropped 1.9 percent.

Investors shrugged off economic data that showed U.S. producer prices fell 0.2 percent in November and were muted even outside of energy, which may influence the U.S. Federal Reserve's plans to keep interest rates near zero for a "considerable time."

In addition, the Thomson Reuters/University of Michigan's preliminary reading on the overall index on consumer sentiment rose in December to a near eight-year high.

Brent crude slipped to a low of $61.91, its lowest since July 2009, and was last down 2.6 percent at $62.04. WTI crude dropped below $58 a barrel and was last down 3 percent at $58.14 as worries persisted over a global supply glut and sluggish demand.

The Dow Jones industrial average fell 181.03 points, or 1.03 percent, to 17,415.31, the S&P 500 lost 18.1 points, or 0.89 percent, to 2,017.23 and the Nasdaq Composite dropped 23.05 points, or 0.49 percent, to 4,685.11.

Adobe Systems rose 9 percent to $76 after saying it would buy stock photography company Fotolia for $800 million. It also reported quarterly revenue above market estimates.

ChemoCentryx Inc surged 62.1 percent to $7.28 after the company said its experimental drug met the main goal of reducing excessive protein in the urine of diabetics with progressive kidney disease.

Declining issues outnumbered advancing ones on the NYSE by 2,293 to 642, for a 3.57-to-1 ratio; on the Nasdaq, 1,804 issues fell and 805 advanced for a 2.24-to-1 ratio.

The benchmark S&P 500 index was posting 13 new 52-week highs and 34 new lows; the Nasdaq Composite was recording 32 new highs and 131 new lows.

Courtesy: Yahoo.com