Stocks Veer Lower Following Another Drop in Oil Price

(AP) —

A slump in crude oil prices and other commodities weighed on stocks in afternoon trading Monday. Energy companies were among the biggest decliners as the price of crude oil sank to the lowest level in more than a decade. Investors also weighed the implications of another drop in China’s stock market.

KEEPING SCORE: The Dow Jones industrial average lost 81 points, or 0.5 percent, to 16,260 as of 1:45 p.m. Eastern time. The Standard & Poor’s 500 index shed 16 points, or 0.9 percent, to 1,905. The Nasdaq composite fell 57 points, or 1.2 percent, to 4,586. The market losses come after U.S. stocks posted their worst week in more than four years.

THE QUOTE: “Investors have one eye on China, and all that’s going on there, and the other eye on oil,” said Erik Davidson, chief investment officer at Wells Fargo Private Bank. “Those two things are keeping investors on pins and needles right now.”

ENERGY: Benchmark U.S. crude shed $1.89, or 5.7 percent, to $31.27 a barrel in New York. The last time it was lower was December 2003. Brent crude, a benchmark for international oils, fell $2.22, or 6.5 percent, to $31.71 a barrel in London.

OIL DRAG: Several energy and mining companies slumped as crude oil and other commodity prices fell. Freeport-McMoRan sank 93 cents, or 17 percent, to $4.5, making it the biggest decliner in the S&P 500 index. Consol Energy also slumped, losing 81 cents, or 10.6 percent, to $6.88. NRG Energy shed $1.07, or 9.4 percent, to $10.27.

MISSED THE MARK: Celgene fell 6.1 percent after the biotechnology company’s forecasts for 2015 and 2016 fell short of Wall Street projections. The company also named a new CEO. The stock lost $6.66 to $102.32.

WORRISOME UPDATE: Prescription drug distributor McKesson slid 10.8 percent after the company said weakening prices for generic drugs are hurting its business. The stock lost $19.63 to $162.76.

DONE DEAL: Irish drugmaker Shire announced its long-rumored agreement to buy U.S.-based rival Baxalta for about $32 billion in cash and stock. The boards of both companies have agreed to the deal, and they expect it to close in the middle of the year. Shire slid $3.52, or 8.2 percent, to $39.25. Baxalta fell 95 cents, or 2.4 percent, to $39.06.

HEALTHY OUTLOOK: HCA Holdings climbed 5.9 percent after the hospital operator raised its profit forecast. The stock added $3.77 to $68.04. The company was the biggest gainer in the S&P 500 index.

SECTOR VIEW: Six of the 10 sectors in the S&P 500 index moved lower. Energy stocks fell the most, 2.8 percent. Utilities stocks, which were up 0.7 percent, led the gainers.

ROUGH WEEK: U.S. stocks are coming off their worst-ever opening week of a year and the biggest weekly slide since September 2011. The slump came as a weakening of China’s currency and steep drops in its stock market stoked worries over the outlook for the world’s second-largest economy.

OVERSEAS: European markets were down. Germany’s DAX slipped 0.2 percent, while the CAC-40 in France lost 0.5 percent. The FTSE 100 index of leading British shares slid 0.7 percent. In Asia, Chinese stocks sank again after a rebound Friday that analysts suggested was due to buying from a group of state entities dubbed the “National Team.” The Shanghai Composite Index fell 5.3 percent and Hong Kong’s Hang Seng sank 2.8 percent. Sydney’s S&P/ASX 200 lost 1.2 percent, while Seoul’s Kospi fell 1.2 percent. Tokyo’s markets were closed for a holiday.

BONDS AND CURRENCIES: Bond prices fell. The yield on the 10-year Treasury note rose to 2.14 percent from 2.12 percent late Friday. The euro fell to $1.0882 from $1.0903 and the dollar edged down to 117.31 yen compared with 117.67 yen late Friday.

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