US markets tumble on sinking crude prices

Traders work on the floor of the New York Stock Exchange in New York City, July 25, 2016.
Traders work on the floor of the New York Stock Exchange in New York City, July 25, 2016.PHOTO: REUTERS

NEW YORK (AFP) - Another sharp fall in oil prices pulled down energy stocks on Wall Street on Monday (July 25), pushing the main US indices to a loss after last week's record highs.

Meanwhile, Yahoo shares tumbled after Verizon announced it would buy the company's web properties for US$4.8 billion (S$6.53 billion).

The Dow Jones Industrial Average finished down 0.4 per cent from Friday's close at 18,493.06.

The broader S&P 500 fell 0.3 per cent at 2,168.48 and the tech-heavy Nasdaq dropped 0.1 per cent at 5,097.63.

US benchmark WTI crude hit a three-month low of US$43.13 a barrel after losing 2.4 per cent in New York trade, hitting the shares of oil majors and service companies.

ExxonMobil lost 1.9 per cent and Chevron dropped 2.5 per cent. Schlumberger, the largest services firm, fell 1.1 per cent and Halliburton 2.9 per cent.

Bill Lynch of Hinsdale Associates said buyers were taking a breather after a heady climb.

"We've been up four consecutive weeks, it would be an opportune moment to take some profits," he said.


Yahoo shares fell 2.7 per cent after the long-expected Verizon deal was announced. Verizon lost 0.4 per cent.

The deal will see the Yahoo News, email and other assets integrated into Verizon's recently acquired AOL unit, while Yahoo will be left as a separate investment company holding Yahoo Japan and the company's most valuable asset, a huge stake in China's Alibaba Group.

"Yahoo is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL," chief executive Marissa Mayer said.

Markets were turning their focus to the Federal Reserve meeting on Tuesday and Wednesday and what the Fed, which is not expected to make any immediate policy shifts, says about the rest of the year.

"Suspicions are building that the Fed may go back to laying the groundwork for another rate hike in the near future," said Patrick O'Hare of