US stocks: Wall Street selloff relentless as oil prices sink

Traders work on the floor of the New York Stock Exchange on Tuesday.
Traders work on the floor of the New York Stock Exchange on Tuesday.PHOTO: EPA

NEW YORK (REUTERS) - Wall Street moved deep into the red in volatile trading on Wednesday, extending this year's selloff as oil prices continued to plummet unabated.

The rout was across the board: all 30 Dow components and all 10 major S&P sectors were in the red, with five down more than 3 per cent. The small-cap Russell's 2000 index fell 2.7 per cent.

The New York Stock Exchange recorded 1,314 stocks hitting new 52-week lows, while 809 sank to new lows on the Nasdaq, the most on a single day since Aug 24 for both exchanges.

The beaten-down S&P energy sector's 5 per cent fall led the decliners. Chevron dropped 5.3 per cent and Exxon 3.2 per cent.

US crude prices sank 6.6 per cent and Brent crude fell 4.7 per cent as a supply glut bumped up against bearish financial news that deepened worries over demand.

"The damage being done in energy is spreading," said Brian Fenske, head of sales trading at ITG in New York.

"Just getting up every morning and seeing the S&P futures down 1-2 per cent has a near-term psychological impact and puts some investors into risk-off mode," Fenske said.

At 1.30 am Singapore time, the Dow Jones industrial average was down 540 points, or 3.4 per cent, at 15,480.78.

The S&P 500 was down 53.24 points, or 2.83 per cent, at 1,828.09, within touching distance of its October 2014 low.

The Nasdaq Composite index was down 122.92 points, or 2.75 per cent, at 4,354.03. The index has closed higher in only two of the 12 trading sessions this year.

The CBOE volatility index, Wall Street's fear gauge, jumped 11 per cent to 29. Gold, a traditional safe haven in times of turmoil, rose more than 1 per cent.

Besides collapsing oil prices, fears of a slowdown in China, the world's second-largest economy and a key market for US companies, has also weighed on equities and commodities, leading to turbulent start to the year on Wall Street.

The S&P 500 has fallen 8 per cent this year, losing more than US$1.4 trillion (S$2.01 trillion) in value, according to Thomson Reuters data.

US corporate earnings are unlikely to offer relief: S&P 500 earnings on average are expected to fall 4.4 per cent, according to Thomson Reuters data.

IBM fell 3.9 per cent to US$123.13 and Goldman Sachs dropped 2.3 per cent to US$153.22 after the Dow components issued disappointing earnings reports.

IBM weighed the most on the Dow, while Apple's 2.7 per cent drop weighed the most on the Nasdaq and the S&P 500.

Netflix was also swept up by the downbeat sentiment, dropping 6.8 per cent to US $100.51, despite reporting a better-than-expected growth in its subscriber base.

Declining issues outnumbered advancing ones on the NYSE by 3,009 to 114. On the Nasdaq, 2,451 issues fell and 335 rose.

The S&P 500 index showed no new 52-week highs and 169 new lows, while the Nasdaq recorded three new highs and 655 lows.