The stock markets in the United States plummeted today as the selloff resumes, which was led by equities in the consumer sector. The shares of companies in banking sector declined to its lowest level. Energy stocks also fell as crude prices continue a downward spiral.
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The recent market selloff wipeout out at least $1.7 trillion from equities, which was primarily caused by the turmoil in China as investors became concerned about the country’s economic growth.
The WTI and Brent crude are trading around $30 per barrel, down 72% from its levels 18 months ago. It was also the first time for the crude oil prices to plunge as low as $30 a barrel since 2003.
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Morgan Stanley predicted that oil prices could drop as low as $20 per barrel while the Royal Bank of Scotland forecasted that $16 a barrel is on the horizon. On the other hand, Standard Chartered Bank suggested the possibility that oil prices could collapse to as low as $10 a barrel.
Mark Kepner, an equity trader at Themis Trading told Bloomberg, “There’s a big time negative sentiment in the market right now. There’s a lot of growth uncertainty in general. Without enough news to make it go higher, and with the negative sentiment, we started selling off.”
On the other hand, Yousef Abbasi, a global market strategist at JonesTrading Institutional Services, said, “With energy selling off, we’ve lost a leg of leadership, which is made worse because we’ve already been seeing risk-off. The FANG gang is making new lows, and small-caps are continuing to get pummeled. What you’re seeing today is some pretty broad-based weakness.”
Eric Rosengren, president of the Federal Reserve Bank of Boston, said the estimates for the U.S. economic growth is facing “downside risks” this year. According to him, “I will remain highly attentive to foreign economic conditions, any weakening of the domestic economic situation, and the path of U.S. inflation.”
- Dow Jones Industrial Average (DJIA) – 16, 151.41 (+2.21 %)
- S&P 500- 1,890.28 (+2.50%)
- NASDAQ- 4,526.06 (+3.41%)
- Russell 2000- 1,009.00 (+3.42%)
- EURO STOXX 50 Price EUR- 3,073.02 (+0.27%)
- FTSE 100 Index- 5,960.97 (+0.54%)
- Deutsche Borse AG German Stock Index DAX- 9,960.96 (-0.25%)
- Nikkei 225- 17,715.63 (+2.88%)
- Hong Kong Hang Seng Index- 19,934.88 (+1.13%)
- Shanghai Shenzhen CSI 300 Index- 3,155.88 (-1.86%)
Stocks in Focus
The stock price of LendingTree declined more than 29% to $61.14 per share. However, the company recovered during the extended trading today, up by more than 41% to $86.63 per share, around 4:09 in the afternoon. The company issued its 2015 earnings guidance of $252.5 – $253.5 million, which implies a growth rate of 51% from its earning in 2014.
Netflix dropped more than 8% to $106.56 per share. Analysts at ITG Research lowered their estimates for the online video streaming company. The firm estimated that the company will report net additions of $1.13 million domestic subscribers, lower than the 1.37 million consensus estimate.
The shares of Cyberark Software climbed 19% to $45.27 each driven. There were speculations that Check Point Software Technologies started to negotiate with Cyberark Software regarding a potential acquisition.