U.S. Stocks Fall on Political Tensions in Europe, Oil in 4-day Slide

Nichole Harper
11 Sep, 2014
New York City

Stocks on Wall Street eased after geopolitical tensions in Europe remained high. Crude oil fell for the fourth day after the IEA lowered its global demand outlook. The U.K. pound trended lower on the rising prospects of Scotland leaving the union. EU slaps more financial sanctions on Russia.

[R]1:15 PM New York – Stocks on Wall Street eased after geopolitical tensions in Europe remained high. Crude oil fell for the fourth day after the IEA lowered its global demand outlook. The U.K. pound trended lower on the rising prospects of Scotland leaving the union. EU slaps more financial sanctions on Russia.[/R]

Stocks on Wall Street declined after geopolitical tensions dragged market sentiment and oil price declined for the fourth day in a row.

Crude oil futures fell in London and New York trading and Brent oil declined to $97.34 a barrel and WTI grade in fell to $91.79 a barrel.

The oil price decline extended to fourth-day in a row after the International Energy Agency lowered its global demand estimate.

S&P 500 index decreased 2.58 to 1,993.23 and the Nasdaq Composite Index dropped 10.90 to 4,575.65.

Weekly jobless claims at the end of last week increased 11,000 to 315,000, according to the data released by U.S. Department of Labor.

The jobless claims were revised for the previous week to 304,000 and continuing claims in the week ending on Aug 30 increased to 2.487 million from 2.478 million in the previous week.

U.S. Movers

Lululemon Athletica Inc ((LULU)) soared 15.5% to $44.54 after the yogawear retailer lifted its annual earnings outlook and reported better than expected earnings.

The Vancouver, British Columbia based retailer revised full-year adjusted earnings outlook to a new range between $1.72 and $1.77 a share up from $1.71 to $1.76.

The retailer also lifted lower end of its annual revenue outlook to $1.78 billion from $1.77 billion.

RadioShack ((RSH)) in a regulatory filing warned that company may run out of financial resources in “very near term” unless it can work out arrangement with its creditors and landlords.

The retailer reported its fiscal second quarter, which ended Aug. 2, net revenues declined 22% to $673.8 million and net loss widened to $137.4 million from $52.2 million.

In addition, the net cash held by the retailer plunged to $30.5 million from $179.8 million at the end of last year.

European Markets

The U.K. pound remained under pressure as Scotland appeared more likely to separate from the United Kingdom after 307 year union.

European Union is said to have agreed to slap additional sanctions on Russia today, according to diplomats in Brussels.

The new list of sanctions will be targeted at the financing and borrowing capacities of Russian oil companies and also expand a black list of Russian officials facing visa bans and asset freeze.

Russian ruble declined to new record low of $37.57 against one U.S. dollar.

In London trading, FTSE 100 index dropped 0.6% or 42.55 to 6,787.56 and in Frankfurt the DAX index slipped 0.3% or 30.48 to 9,669.69.

In Paris, CAC 40 index fell 0.4% or 19.63 to 4,431.16.

Gazprom OAO slipped 1.7% to 136.93 rubles after the Russia-based natural gas explorer reported revenue in the first-quarter ending in March jumped 6.5% to 1.56 trillion rubles from 1.46 trillion rubles a year ago period.

Net profit in the quarter declined 41.4% from a year ago to 223 billion rubles compared to 380.7 billion rubles.

Wm. Morrison Supermarkets Plc edged up 0.1% to 176.80 pence after the U.K.-based food retailer reported sales in the first-half ending on August 3 dropped 4.9% to £8.50 billion form £8.94 billion a year ago period.

Profit in the period plunged 11.8% from a year ago to £183 million compared to £267 million and diluted earnings per share slumped to 7.81 pence from 11.44 pence.

Asian Markets

Stocks in Japan closed higher and Topix extended its six-year high after the yen declined to a new six-year low against the dollar.

The Nikkei 225 Stock Average jumped 120.42 or 0.8% to 15,909.20 and the broader Topix index rose 4.45 to 1,311.24.

The yen declined to close at 106.85 against one U.S. dollar.

In Mumbai trading, the Sensex Index fell 61.54 or 0.2% to close at 26,995.87 The CNX Nifty slid 8.40 to 8,085.70.

Cox & Kings Ltd increased 1.9% to Rs 305.85 after the company sold its camping division Holidaybreak to Homair Vacances for £89.2 million.

The company also plans to raise up to Rs 350 crore through a qualified institutional placement and cut its debt of $900 million.

NTPC Limited rose 0.4% to Rs 140.05 after the company’s board approved investment of about $1.9 billion in two thermal plant projects.