S&P 500 Index Plunges 1.8% and Extends 4-day Losses, Oil Flirts with $50

Nichole Harper
05 Jan, 2015
New York City

U.S. and European markets dropped sharply as German prices stagnated in December. Political rhetoric in Greece heated as the nation approached snap election. S&P 500 index extended losses for the fourth day in a row. Crude oil price declined 4.5%.

[R]1:35 PM New York – U.S. and European markets dropped sharply as German prices stagnated in December. Political rhetoric in Greece heated as the nation approached snap election. S&P 500 index extended losses for the fourth day in a row.[/R]

U.S. and European markets dropped sharply as oil continued to slide and fears in the euro zone resurfaced.

Market indexes in Europe dropped between 1.5% and 2.7% and indexes in New York dropped more than 1.3% and oil price tumbled nearly 4% in New York and London.

On Wall Street trading, Tollbooth Strategy Index dropped 1.6% or 156.74 to 9,882.60 and the index outperformed the S&P 500 index for the thirteenth year in the last fifteen years since its creation.

S&P 500 index declined 33.44 or 1.6% to 2,024.80 and the Nasdaq Composite Index slumped 55.90 or 1.2% to 4,670.70.

The S&P 500 index is set to decline for the fourth day in a row, the longest stretch since December 2013. The benchmark index has jumped more than 200% from its low in March 2009 and the index never declined more than three days in a row in 2014.

The selloff in New York was prompted by the market weakness in Europe after Germany reported weaker than expected inflation in December as prices stagnated.

In addition, investors speculated the fate of Greece in the euro zone as the nation approached snap election and political rhetoric heated after Prime Minister Antonis Samaras claimed that the nation will leave the currency union if the opposition party wins.

U.S. Movers

Ford Motor Company ((F)) declined 3.6% or 56 cents to $14.80 after the automobile maker said December sales rose 1% to 220,671 vehicles from a year ago month. December sales were best since 2005.

Lincoln division sales soared 21% to 9,690 vehicles. F-Series sales in December increased to 74,355 vehicles and 2014 sales were 753,851 vehicles.

Total sales in the year were flat at 2,480,942 vehicles.

Fiat Chrysler Automobiles NV slumped 3.7% or 43 cents to $11.27 after the automaker reported U.S. December sales climbed 20% from a year ago to 193,261.

The company marked the best December in a decade and sales rose for the 57th consecutive month in a row.

Jeep brand vehicles sales soared 19% to 63,274 units from a year ago month, Ram sales climbed 35% to 48,628 units, Dodge sales slumped 2% to 46,578 units.

Chrysler brand sales jumped 53% to 30,930 units, while Fiat brand sales rose 1% to 3,784 units.

General Motors Company ((GM)) slipped 1.5% or 54 cents to $34.30 after the automobile company reported sales in December surged 19.3%, the best December sales in seven years.

Retail sales soared 23% and fleet deliveries jumped 6%.

GM posted 27th consecutive month of an increase in average transaction price reaching a record of $36,300; $1,000 higher from November and about $3,000 higher from a year ago month.

Sales of GM pickup trucks, Chevrolet Silverado and GMC Sierra surged 35% to 81,273 units.

European Markets

In London trading, FTSE 100 index slumped 1.6% or 103.26 to 6,444.54 and in Frankfurt the DAX index dropped 2.4% or 237.26 to 9,527.47.

In Paris, CAC 40 index declined 2.7% or 114.72 to 4,137.57.

Bayerische Motoren Werke AG declined 3.2% to €85.19 after the Germany-based auto maker agreed to pay 5.1 billion yuan or $820 million to its China-based distributors as financial to cover their losses as the domestic retailers threatened to sustain the car orders.

Ryanair Holdings Plc gained 1.5% to €9.95 after the Ireland-based discount airline said traffic in December soared 20% to more than 6.02 million customers and load factor to 88% from 81% in a year ago month.

Asian Markets

Japanese market indexes traded lower on the first trading day of the year and financial stocks were under pressure.

Skymark Airlines soared 17% after the company called for an extraordinary investor meeting. NTT DoCoMo filed arbitration claim against India-based Tata Teleservices.

Stocks in Tokyo lacked direction and at close market indexes closed down and the yen eased.

Sentiment in trading was cautious ahead of the European and U.S. market trading and crude oil continued to slide and closed at a new 5-year low.

The latest Markit Economics survey showed manufacturing sector continued to expand in December with a Purchasing Manufacturing Index at 52, unchanged from the November.

The Nikkei 225 Stock Average slipped 42.06 or 0.2% to 17,408.71 and the broader Topix index fell 6.42 to 1,401.09.

The yen slid to 120.33 against one dollar.

In Mumbai trading, Sensex Index fell 45.58 to close at 27,842.32. The CNX Nifty slid 17.05 to 8,378.40.

Ashok Leyland Limited surged 8.3% to Rs 57.85 after the auto maker said total sales in December surged 48% to 9,290 units from a year ago period.

Sales of medium and heavy commercial vehicle soared 85% to 7,210 units and light commercial vehicles declined 13% to 2,080 units from a same period last year.

Larsen & Toubro Limited advanced 1.2% to Rs 1,556.50 after the infrastructure developer won an order worth Rs 4,006 crore or $650 million from domestic and international clients.