Stocks fall after biggest weekly loss since 2012
By BERNARD CONDON (AP)
NEW YORK (AP) — U.S. stocks are falling Monday afternoon, following the market's biggest weekly loss in two and a half years, as the price of oil continues a six-month slide. The Russian ruble has plunged to a record low against the dollar.
KEEPING SCORE: The Standard & Poor's 500 index fell eight points, or 0.4 percent, to 1,994 as of 2:57 p.m. Eastern. The Dow Jones industrial average dropped 68 points, or 0.4 percent, to 17,212. The Nasdaq composite fell 38 points, or 0.8 percent, to 4,615.
The S&P 500 dropped 3.5 percent last week, its biggest decline since May 2012.
OIL: The price of oil dropped, erasing an early gain. Benchmark U.S. crude fell $1.90, or 3.3 percent, to close at $55.91 a barrel on the New York Mercantile Exchange. Oil has fallen by about half since June on waning global demand and abundant supplies. The recent drop to five-year lows has been roiling stock markets.
RUSSIA'S PAIN: The ruble sank 13 percent to 65.83 to the dollar. The ruble started the year at 32.85 to the dollar. The falling price of oil, which is the chief source of Russian exports and tax revenue, has weighed heavily on the currency.
EUROPE DROP: Major European indexes closed sharply lower after big losses last week. France's CAC 40 lost 2.5 percent and Germany's DAX fell 2.7 percent. Britain's FTSE 100 was down 1.9 percent.
The Euro Stoxx 50 fell 6 percent last week, its biggest drop since early August 2011.
THE QUOTE: "People are taking profits, and it can go on for a while," said Uri Landesman, president of Platinum Partners, an investment fund in New York. "You're seeing a min-recorection."
BUYOUT BOUNCE: Riverbed Technology and PetSmart are soaring on news that they agreed to be bought. Riverbed, a maker of computer-network equipment, jumped $1.61, or 9 percent, to $20.35 after agreeing to a $3.6 billion sale to private-equity firm Thoma Bravo and a Canadian pension fund. Pet-supplies chain PetSmart rose $3.26, or 4.3 percent, to $80.92 after announcing Sunday that it had agreed to an $8.7 billion sale to a group of investors led by BC Partners.
FACTORY FIX: U.S. manufacturing output in November surpassed its pre-recession peak as auto production ramped up. The Federal Reserve figures are an encouraging sign that America's factories are somewhat insulated from the global economic slowdown.
NEXT UP: A two-day meeting of the Federal Reserve begins Tuesday after which the central bank will release a statement that could move markets. Investors will be looking to see if the statement keeps two key words: "considerable time," a reference to how long the Fed plans to keep short-term interest rates near zero. Those low rates are widely credited with helping stocks race higher over the past in the nearly six-year bull market.
Most economists think the Fed will wait until June to raise rates.
JAPAN ELECTIONS: Japan's ruling coalition won in lower house elections Sunday, giving Prime Minister Shinzo Abe's Liberal Democrats up to four more years. However a business survey released Monday highlighted the challenges facing Abe's government, which is using large-scale monetary and fiscal stimulus to try to end two decades of stagnation. More than two-thirds of companies surveyed said the outlook for the coming quarter wasn't favorable.
ASIAN SCORECARD: Japan's Nikkei closed down 1.6 percent. Hong Kong's Hang Seng dropped 1 percent and Seoul's Kospi shed 0.1 percent. Australia's S&P/ASX 200 dropped 0.6 percent. China's Shanghai Composite reversed losses to close up 0.5 percent.
BONDS: Prices for U.S. government bonds fell. The yield on the 10-year Treasury note rose to 2.12 percent from 2.08 percent late Friday.
COMMODITIES: In other energy trading, Brent crude, a benchmark for international oils used by many U.S. refineries, fell 79 cents to close at $61.06 in London. In New York, wholesale gasoline fell 2.1 cents to close at $1.576 a gallon, heating oil fell 1.4 cents to close at $2.002 a gallon and natural gas fell 7.6 cents to close at $3.719 per 1,000 cubic feet.
Precious and industrial metals futures fell. Gold declined $14.80 to $1,207.70 an ounce. Silver fell 49 cents to $16.56 an ounce and copper lost six cents to $2.88 a pound.