NEW YORK -- Energy companies and oil prices took their worst losses in months Friday on reports OPEC countries plan to produce more oil soon. Stock indexes finished an indecisive week with small losses.
The S&P 500 index slid 6.43 points, or 0.2 percent, to 2,721.33. The Dow Jones industrial average fell 58.67 points, or 0.2 percent, to 24,753.09. The Nasdaq composite climbed 9.42 points, or 0.1 percent, to 7,433.85 as consumer-focused companies moved higher. The Russell 2000 index of smaller-company stocks lost 1.29 points, or 0.1 percent, to 1,626.93.
U.S. markets will be closed Monday for the Memorial Day holiday.
U.S. crude oil sank 4 percent after multiple reports indicated that Russia and the Organization of the Petroleum Exporting Countries could start producing more oil soon. They cut production at the start of 2017 after a big buildup in supplies that had pushed prices lower.
In November, they extended that cut through the end of 2018, but according to reports this week, they might agree to start raising production in June. U.S. crude finished at a three-year high Monday and has fallen 6 percent since then.
The drop in oil prices has meant sharp losses for energy companies, but it gave airlines a boost as investors anticipated lower fuel costs. Bond yields declined again, which hurt banks but helped dividend-payers like makers of household goods.
Wall Street also focused on quarterly results from retailers. Gap plunged after it said its namesake brand is still struggling, but Foot Locker soared after it said sales of premium shoes improved.
Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, said energy companies and oil prices had made big gains lately and were due to slow down. He said the growing global economy is going to help the industry in the longer term.
"If you look at the sectors that are outperforming, it's those that tend to be pro-growth," he said, especially technology and consumer-focused companies. Over the past month, that growth, and the strong company profits that come with it, have not translated into gains for stocks. Sandven said that could change when companies start reporting their second-quarter results in July.
U.S. crude dropped to $67.88 a barrel in New York. Brent crude, used to price international oils, fell 3 percent to $76.44 a barrel in London. Increased oil production and lower prices could reduce profits for energy companies. Exxon Mobil fell 1.9 percent to $78.71, and Chevron gave up 3.5 percent to $122.19.
Fiat Chrysler fell 2 percent to $21.82 after saying it's recalling 5.3 million vehicles in the U.S. because in rare circumstances drivers may not be able to turn off the cruise control. The company warned owners not to use cruise control until the vehicles can be fixed with a software update.
Among airlines, Delta gained 2.7 percent to $55.87, and American rose 3.1 percent to $44.91. The stocks have skidded over the last few months as the rising price of oil increased their fuel costs and cut into their profits. Delta stock is flat in 2018, and American Airlines has fallen 14 percent.
Bond prices kept rising. The yield on the 10-year Treasury note fell to 2.93 percent from 2.98 percent.
Business on 05/26/2018