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US STOCKS-Wall Street drops after Saudi attacks, energy stocks spike

Published 16/09/2019, 19:47
© Reuters.  US STOCKS-Wall Street drops after Saudi attacks, energy stocks spike
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(For a live blog on the U.S. stock market, click LIVE/ or

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* Dow set to snap 8-day winning streak

* Energy sector eyes biggest one-day jump since Jan. 4

* Airlines, cruise operators fall on cost concerns

* United Auto Workers call for strike on GM; shares fall

* Indexes: Dow -0.44%, S&P 500 -0.31%, Nasdaq -0.28%

(Updates to afternoon)

By Noel Randewich

Sept 16 (Reuters) - Energy stocks spiked while the rest of

Wall Street fell on Monday after weekend attacks on Saudi

Arabia's oil facilities added to investors' concerns about

geopolitical risk and a slowing global economy.

The attacks on the world's biggest crude exporter sent oil

prices up more than 20% before they eased as various nations

said they would tap emergency reserves to ensure stable

supplies. The S&P 500 energy .SPNY , one of the worst performing

sectors so far this year, soared 3.75%, on track for its largest

one-day gain since December. Shares of Apache Corp APA.N ,

Marathon Oil Corp MRO.O and Helmerich and Payne HP.N jumped

between 12% and 18% and were the leading gainers on the S&P 500.

The Saudi-led military coalition battling Yemen's Houthi

movement said the attack was carried out with Iranian weapons,

raising the prospect of a global conflict involving the United

States and Iran.

"The U.S. investor is waiting with bated breath about what

the U.S. and its allies might do," said Jake Dollarhide, chief

executive officer of Longbow Asset Management in Tulsa,

Oklahoma.

Anticipation of higher fuel costs drove down shares of

airlines and cruise line operators with the S&P 1500 airlines

.SPCOMALI shedding 2.5%, while Carnival Corp CCL.N fell

3.7%.

Retail stocks .SPXRT lost 1.5% and were among the biggest

drags on the S&P 500.

"The drone strike in Saudi has had an impact on how

investors are looking at the security and stability of the

global energy supply chain and is fueling a degree of risk

reassessment," said Peter Kenny, founder of Kenny's Commentary

LLC and Strategic Board Solutions LLC in New York.

Shares of defense companies Raytheon RTN.N , Lockheed

Martin Corp LMT.N , Northrop Grumman Corp NOC.N rose more

than 1%. J.P. Morgan upgraded Raytheon shares to "overweight."

At 2:27 p.m. ET, the Dow Jones Industrial Average .DJI was

down 0.44% at 27,098.81 points, while the S&P 500 .SPX lost

0.31% to 2,998.13.

The Nasdaq Composite .IXIC dropped 0.28% to 8,153.98.

Nine of the 11 major S&P sectors were lower.

Wall Street's more than a decade-long rally continues to

hinge on whether the Fed will keep cutting interest rates and on

progress in U.S.-China trade talks. A recent easing in trade

tensions has brought the benchmark S&P 500 .SPX about 1% below

its record high.

Among other movers, General Motors Co GM.N fell 4.7% after

the United Auto Workers went on strike on Sunday, the first

nationwide strike at GM in 12 years. Advancing issues outnumbered declining ones on the NYSE by a

1.14-to-1 ratio; on Nasdaq, a 1.24-to-1 ratio favored advancers.

The S&P 500 posted 5 new 52-week highs and 1 new low; the

Nasdaq Composite recorded 47 new highs and 24 new lows.

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