by Warner Todd Huston | August 21, 2015 3:38 pm
This has been a pretty bad week for the stock market. But it been particularly bad for oil prices–but NOT for consumers–as oil has fallen below $40 a barrel for the first time since 2009.
Oil in particular has plunged as all the oil producers (including the USA) have been fighting for market share.
Prices have tumbled almost 35 percent since this year’s peak in June as producers maintain output even after an oversupply pushed prices into a bear market. WTI may drop to $32 on the persisting global surplus, Citigroup Inc. said in a report Aug. 19. Concerns that China’s economic growth will reduce demand also weighed on futures. Brent also fell to a six-year low.
“It’s clear that the major producers, the Saudis, Russians, the U.S. and others, are battling for market share,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said by phone.
West Texas Intermediate for October delivery dropped $1.09, or 2.6 percent, to $40.23 a barrel at 2:07 p.m. on the New York Mercantile Exchange. It touched $39.86, the lowest level since March 2009. The volume of all futures traded was 20 percent above the 100-day average. Prices are heading for an eighth weekly loss, the longest streak since 1986.
But the stock market has been falling, falling, falling this week too. Yesterday the S&P had a really bad day…
It was an ugly Thursday for the stock market. The Dow lost more than 350 points, tumbled to its lowest level since February, and is now down 7% from its all-time high. The S&P 500 had its biggest one-day loss since February 2014.
One of the reasons the market is down so badly is that China’s financial troubles are showing no sign of getting better.
It was another bad session on the Shanghai stock market today as economic weakness and a poor lead from the US and European markets weighed on sentiment.
The Shanghai Composite index was down as much as 4.5% after lunch, hitting a low of 3,494 before a small rally to finish at 3,509, down 4.21%. That brings the week’s losses to a stunning 460 points, or 11.60%.
These are interesting times, eh, China?
Finally, today the DOW closed down more than 500 points!
It’s Stockpocalypse, folks.
Source URL: https://rightwingnews.com/economy/bad-week-for-stocks-oil-crashes-below-40-a-barrel-for-first-time-since-2009/
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