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Overnight Markets: Wall Street falls on Iraq concerns
by Himanshu Singh on Jun 13, 2014 at 03:52
Wall Street declined on Thursday as escalating violence in Iraq sent oil to an eight-month high and after disappointing economic data on retail sales and jobless claims.
The Dow Jones industrial average fell 110 points or 0.65%, to end at 16,734. The S&P 500 slid 14 points or 0.71%, to 1,930. The Nasdaq Composite fell 34 points or 0.79%, to 4,298.
Hours after ethnic Kurdish forces took control of the oil hub of Kirkuk after the Shi'ite-led government's troops abandoned their posts, President Barack Obama said that he refused to rule out US action in Iraq against Sunni Islamist militants.
The stock market's losses quickly accelerated following Obama's comments, with industrials and consumer discretionary sectors leading the decline.
In macroeconomic news, retail sales rose 0.3% in May, half the growth rate that economists had forecast. Americans' new claims for unemployment benefits unexpectedly rose last week.
Energy shares ranked among the few gainers yesterday after oil prices hit nine-month highs on worries that escalating violence in Iraq could disrupt oil supplies from the major OPEC exporter.
Shares of major US airlines dropped for a second straight day as oil prices rallied. American Airlines Group Inc (AAL.O), the world's largest carrier, tumbled 4.9% while United Continental Holdings Inc (UAL.N) fell 5.9%.
Geron Corp (GERN.O) surged 21.2% on heavy volume after the US Food and Drug Administration lifted a partial clinical hold on a study testing its blood cancer drug.
Lululemon Athletica Inc (LULU.O) fell 15.9% on heavy volume. The athletic apparel retailer cut its full-year earnings and revenue outlook.
A bright spot was Restoration Hardware Holdings Inc (RH.N), which climbed 12.7% a day after the luxury home furnishings retailer's first-quarter results.
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As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.
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