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Publish Date: Tue, 15 Oct 2024, 05:45 AM
- ASML's weak sales forecast impacts tech shares
- Oil prices fall due to easing supply worries and weak demand
- Financial firms post strong profits, healthcare results disappoint
NEW YORK, Oct 15 (Reuters) - U.S. stocks closed down on Tuesday, following world stocks lower as a weak sales forecast from chipmaker ASML (ASML.AS) , opens new tab weighed on tech shares, while crude extended its slide due to easing supply worries and weakening demand.
The three major U.S. indexes ended the session in negative territory, with the S&P 500 and the Dow easing back from Monday's record closing highs.
Financial firms Goldman Sachs (GS.N) , opens new tab, Citigroup (C.N) , opens new tab and Bank of America (BAC.N) , opens new tab all posted better-than-expected profit, while healthcare companies UnitedHealth (UNH.N) , opens new tab and Johnson & Johnson (JNJ.N) , opens new tab results underwhelmed investors.
But Netherlands-based chip equipment maker ASML posted third quarter results that surprised markets with weak bookings and lower-than-expected sales forecasts, dour news that proved contagious to the U.S. chip sector (.SOX) , opens new tab.
"The U.S. stock market is so heavily weighted in tech, it’s going to drive where the overall market appears to be going," said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management in Seattle. "But below the surface it’s not bad news across the board."
"The global story is more due to soft data," Haworth added.
Energy stocks (.SPNY) , opens new tab suffered the steepest percentage drop among the major S&P 500 sectors, falling 3.04% on sliding crude prices.
The Dow Jones Industrial Average (.DJI) , opens new tab fell 324.60 points, or 0.75%, to 42,740.62, the S&P 500 (.SPX) , opens new tab fell 44.54 points, or 0.76%, to 5,815.31 and the Nasdaq Composite (.IXIC) , opens new tab fell 187.10 points, or 1.01%, to 18,315.59.
European stocks posted their largest one-day percentage drop in over two weeks, weighed by tech stocks in the wake of ASML's disappointing annual sales forecast.
Meanwhile, investors remained focused on the European Central Bank's rate decision on Thursday.
MSCI's gauge of stocks across the globe (.MIWD00000PUS) , opens new tab fell 6.20 points, or 0.72%, to 850.98. The STOXX 600 (.STOXX) , opens new tab index fell 0.8%, while Europe's broad FTSEurofirst 300 index (.FTEU3) , opens new tab fell 19.22 points, or 0.92%.
Emerging market stocks (.MSCIEF) , opens new tab fell 11.40 points, or 0.98%, to 1,148.66.
Oil prices slid to a near two-week low, extending Monday's losses amid easing supply pressures arising from the conflict in the Middle East, amid reports Israel's Prime Minister Benjamin Netanyahu told U.S. President Joe Biden's administration that Israel would avoid striking Iranian oil targets.
Additionally, OPEC and the International Energy Agency both lowered their global demand forecasts, mostly due to weakness in China.

"Sliding oil prices are disinflationary and that’s a positive for the broader economy," said Tim Ghriskey, senior portfolio strategist Ingalls & Snyder in New York. "What you’re seeing now is the speculation that Middle East oil properties are going to be exempt from attack."
"And falling oil prices does say something about global demand."

U.S. crude tumbled 4.40% to $70.58 per barrel, while Brent fell to $74.25 per barrel, down 4.14% on the day.
Benchmark U.S. Treasury yields edged lower, pausing after touching a 2-1/2 month high in the wake of soft manufacturing data from the New York Federal Reserve.
The yield on benchmark U.S. 10-year notes fell 3.7 basis points to 4.036%, from 4.073% late on Friday.
The 30-year bond yield fell 5.8 basis points to 4.3237% from 4.382% late on Friday.
The 2-year note yield, which typically moves in step with interest rate expectations, rose 1.1 basis points to 3.952%, from 3.941% late on Friday.
The dollar was nominally lower against a basket of world currencies amid wagers that the Federal Reserve will proceed with modest rate cuts in the near term.
The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.06% to 103.24, with the euro down 0.2% at $1.0887.
Against the Japanese yen , the dollar weakened 0.37% to 149.2.
Gold gained traction, lifted by lower Treasury yields.
Spot gold rose 0.4% to $2,661.80 an ounce.
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(This story has been refiled to add the dropped word 'tech' in the headline)
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https://www.reuters.com/markets/global-markets-wrapup-1-2024-10-15/