Tallahassee Journal

Dow loses 208 as oil slips to around $30

Dow loses 208 as oil slips to around $30

Stocks ended lower Monday as oil prices dropped more than 5% and fell back to around $30 a barrel. The drop comes after Wall Street was able to finally bounce back last week in the market’s first week of positive returns for U.S. stocks in the new year.  But the relief rally, while welcomed and much-needed, wasn’t enough for still-shaken bulls to go out on a limb and send a definitive all-clear signal.USA - Business - Dow Jones Sign

The Dow Jones industrial average finished down 208 points, or 1.3% to slide 15 points under 16,000. The Standard & Poor’s 500 index dropped 1.6% and the Nasdaq composite retreated 1.6%. Oil prices retreated as U.S. benchmark crude fell fell 4.8% to $30.62 a barrel after a rally last week sent prices surging back above $32 a barrel. Stocks remain under pressure as both the Dow and S&P 500 remain in correction territory, or down 10%-plus from their highs. Heading into Monday’s session the Dow was already off 7.6% in 2016 and the S&P 500 is down 6.7%.

“There’s been damage to the bullish thesis,” according to Tom Lee, founder of Fundstrat Global Advisors. But that doesn’t necessarily mark an end to the bull, nor should investors believe the declines are “irreversible,” he adds. Still, there’s a chorus of pundits who say the investing climate has shifted from a “buy-the-dip” mentality to a “sell the rip (rally)” mindset. Nor will China’s economic pains go away anytime soon, or the debate on whether the Chinese slowdown will cause a serious slowdown in the U.S.

And now that U.S. recession worries are on the radar, and talk of a bear market in stocks is part of the new market narrative, the prospect of tough sledding ahead for stocks remains real. Overseas, Asian stocks rose Monday amid expectations of monetary stimulus in Europe and Japan. Japan’s Nikkei 225 index gained 0.9% to close at 17,110.91 while Hong Kong’s Hang Seng index rose 1.4% to reach 19,340.14. The Shanghai composite index rose 0.8% to close at 2,938.51.