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SPY Falls as Oil Prices and Walmart Weigh on the Index

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SPY closes in negative territory

US stocks (QQQ) closed lower in yesterday’s trade. The three-day rally was broken as the fall in oil prices weighed on investors’ minds. As we have seen in the last three days, the deal between the major OPEC (Organization of the Petroleum Exporting Countries) and non-OPEC exporters to stabilize crude oil prices has boosted crude oil prices. Saudi Arabia and Russia (RSX) have decided to freeze production at January levels, and this was later supported by Iran. With major crude oil exporters agreeing to the deal, crude oil (USO) prices have jumped in the last three days.

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The Market opened higher yesterday as crude oil prices rose 3% in early trading. Later in the day, a report stated that US crude oil inventories rose by 2.1 million barrels, which led to the fall of crude oil prices. Major integrated oil and gas companies such as Occidental Petroleum (OXY), Chevron (CVX), and ConocoPhilips (COP) fell 0.48%, 1.8%, and 0.62%, respectively, and the SPDR S&P 500 ETF (SPY) fell 0.41% on the day.

SPY was also affected by corporate news yesterday, including Walmart’s (WMT) 4Q15 earnings. It beat Market expectations with a quarterly profit of $1.49 per share. However, the company cut its full-year revenue forecast because of the strong US dollar. Thus, the stock fell 3% and weighed on SPY yesterday.

What to look for in this series

In this series, we’ll discuss which sectors drove SPY’s movement and why. We’ll close the series with a look at SPY’s top performer. Let’s begin by looking at how various sectors performed yesterday.

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