Wall Street Ends Lower on Energy Stocks

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Wall Street Ends Lower on Energy Stocks

US stocks ended mostly lower as a slump in Energy stocks offset wages data that supported expectations that the Federal Reserve would hold off raising the interest rates for the time being.

The Dow Jones Industrial Average 55.32 points or 0.3% lower at 17.960 points but ended the week 0.7% higher and 0.4% higher for the month.

The S&P 500 Index ended 4.71 points or 2.32% higher at 2,103.90 points despite adding about 1.2% for the week and 2% for the month.

The Nasdaq Composite ended flat for the day and 0.8% lower for the week.

“It’s all about rotation (between sectors). That’s what this market has been about since we’ve been in such a tight trading range this year,” Dennis Dick, head of markets structure and a proprietary trader at Bright Trading LLC in Las Vegas, told Reuters.

Energy shares fell the most in more than seven months with EXXON Oil and Chevron ending more than 5% lower after reporting worse than expected second quarter earnings after oil prices took a hit from the oil glut during the quarter.

The declines in these stocks coupled to fall is crude prices during the day weighed the Energy Index more than 2.6% lower in the day, its biggest one day decline since January.

A report by the Labor department on Friday showed that salaries and wages in the US rose at the slowest pace in the second quarter showing that the labor market was yet to fully recover.

The wages report sparked speculation that the Federal Reserve now would hold off the commencement of its first monetary tightening in more than a decade.

The Federal Reserve Chairwoman Janet Yellen had earlier in the week stated that the Federal Reserve would increase the interest rates later this year if the economy continued to improve in line with expectations.

“It makes it that much tougher for the Fed to raise rates when you have no wage growth,” Bruce Bittles, chief investment strategist at Milwaukee-based Robert W. Baird & Co., which oversees $110 billion, told Bloomberg

To contact the reporter of the story: Samuel Rae at samuel@forexminute.com