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US stocks, bank shares also drop

New York / AFP

US stocks tumbled, with energy-related equities dropping on lower oil prices and large banks falling on worries over bad energy loans.
The Dow Jones Industrial Average fell 188.88 points (1.14 percent) to 16,431.78.
The broad-based S&P 500 fell 24.23 (1.25 percent) to 1,921.27, while the tech-rich Nasdaq Composite Index dropped 67.02 (1.47 percent) to 4,503.58.
Oil prices slumped more than four percent after Saudi Arabia’s oil minister Ali Al-Naimi ruled out any production cuts to address a price rout. Dow member Chevron and ConocoPhillips both lost nearly 4.5 percent.
Dow member JPMorgan Chase slumped 4.2 percent after it disclosed it plans to set aside an additional $600 million to cover potential loan defaults in the energy and mining sector, and could reserve another $1.5 billion if conditions worsen.
Bank of America lost 3.0 percent and Citigroup 3.3 percent.
Dow member United Technologies fell 0.8 percent following its statement that it halted merger talks with Honeywell due to “insurmountable regulatory obstacles and strong customer opposition” that would make a combination impossible. Honeywell fell 0.9 percent.
Dow member Home Depot climbed 1.4 percent after reporting that fourth-quarter earnings rose 6.7 percent to $1.5 billion and that it will boost its dividend by 17 percent. Home Depot also projected 2016 comparable store sales growth of 3.7 to 4.5 percent.
Macy’s rose 3.0 percent after reporting fourth-quarter earnings of $2.26 per share, much above the $1.89 expected by analysts. Colder weather in January boosted sales in northern climate zones.
Fitbit dived 20.8 percent on a forecast of $420-440 million in first-quarter revenues, below the $485 million expected by analysts. The outlook highlighted worries that the wearables company’s prospects could be threatened by competition from Apple and others.
Cabot Oil and Gas sank 10.6 percent as a civil trial began in the state of Pennsylvania over allegations
that fracking from Cabot wells
contaminated drinking water.

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