U.S. stock-index futures were down sharply Monday, falling their daily limit, as fears of an oil price war between OPEC and Russia sent crude futures plunging, sending shock waves through global financial markets already shaken by the spread of COVID-19.
Stocks could see steeper losses when cash trading opens Monday. Initial circuit breakers kick in to temporarily halt trading with a fall of 7%.On Friday, the Dow Jones Industrial Average DJIA, -0.98% settled 256.50 points lower, or 1%, to 25,864.78, while the S&P 500 SPX, -1.70% lost 51.57 points, or 1.7%, to close at 2,972.37. The Nasdaq Composite COMP, -1.86% finished 162.98 points lower, or 1.9%, at 8,575.62.
Oil futures plunged 10% on Friday after talks between the Organization of the Petroleum Exporting Countries and their allies collapsed with Russia refusing to agree to a Saudi-led plan for additional crude production cuts. In response, Saudi Arabia over the weekend slashed crude prices and is preparing to increase production, in a direct attack against Russia’s market share, The Wall Street Journal reported.
“U.S. shale and Canadian tar sands are in for a nightmarish year I fear,” wrote Jeffrey Halley, senior Asia Pacific market strategist at Oanda, late Sunday. “Production becoming a battle of who has the deepest pockets.”
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