US stocks dropped on Friday putting the S&P 500 on track to snap the seven weeks of gains with oil prices dropping to fresh lows of five years after disappointing China data.
The S&P 500 ended the day 1.6% lower to $2,002.70, taking the losses for the week to 3.5%. The last time that it suffered such a decline was in May 2012, as reported by The Financial Times.
The Dow Jones Industrial Average declined 1.8% or 312 points to 17,284.30 while the Nasdaq Composite finished the day 1.2% lower or 54.56 points at 4,653.596.
Weak prices of oil have increased worries of global demand and have raised concerns on earnings about earnings for energy companies with the year-end tax selling putting more pressure on the energy sector.
According to Reuters, Brent crude dropped to lows of $62.75, the lowest from Jul 2009 and it was last down 0.6% at $63.30. WTI crude declined below $60 per barrel and it was last down 1% at $59.37 as worries increased over the global supply glut and a sluggish demand outlook. The Select Sector Energy ETF dropped 0.8% in premarket trade.
Adding to the pessimism was the data showing that the Chinese economy showed signs of softening in November as factory growth slowed more than expected and investment expansion hovered near a low of 13 years.
Adobe systems increased 7.5% to $75 in premarket after the company said it would buy stock photography company Fotolia for $800 million and reported quarterly revenue that was above market estimates.
European shares dropped with further declines in oil prices hitting energy stocks, while political concerns over Greece also pegged back equities.
Asian shares got a boost after upbeat US spending data suggested weaker prices of oil have some upside for the US economy.
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