NEW YORK – Energy companies and oil prices took their worst losses in months Friday on reports OPEC countries plan to produce more oil soon. Stock indexes finished an indecisive week with small losses.
U.S. crude oil sank 4 percent after multiple reports indicated that Russia and OPEC could start producing more oil soon. They cut production at the start of 2017 following a big buildup in supplies that had pushed prices lower.
In November they extended that cut through the end of 2018, but according to reports this week, they might agree to start raising production in June. U.S. crude finished at a three-year high Monday and has fallen 6 percent since then.
The drop in the price of oil has meant sharp losses for energy companies, but it gave airlines a boost as investors anticipated lower fuel costs. Bond yields declined again, which hurt banks but helped dividend-payers like household goods makers.
Wall Street also focused on quarterly results from retailers. Gap plunged after it said its namesake brand is still struggling, but Foot Locker soared after it said sales of premium shoes improved.
Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, said energy companies and oil prices had made big gains lately and were due to slow down.
He said the growing global economy is going to help the industry in the longer term.
“If you look at the sectors that are outperforming, it’s those that tend to be pro-growth,” he said, especially technology and consumer-focused companies.
The S&P 500 index slid 6.43 points, or 0.2 percent, to 2,721.33. The Dow Jones industrial average fell 58.67 points, or 0.2 percent, to 24,753.09. The Nasdaq composite climbed 9.42 points, or 0.1 percent, to 7,433.85 as consumer-focused companies moved higher. The Russell 2000 index of smaller-company stocks lost 1.29 points, or 0.1 percent, to 1,626.93.
U.S. markets will be closed Monday for the Memorial Day holiday.
This article provided by NewsEdge.