Market Update: Stocks Retreat as Trade Risks Linger; Oil Markets Turn to OPEC
U.S. stocks drifted lower Monday, as lingering trade concerns between China and the United States curbed investor appetite for riskier assets.
Wall Street’s benchmark indexes headed lower in early-week trading, with the Dow Jones Industrial Average recording its fourth straight decline. Dow industrials settled down 102.94 points, or 0.4%, at 24,987.54.
The broader S&P 500 Index declined 0.2% to close at 2,773.86. Seven of 11 primary sectors contributed to the declines, led by a nearly 2% retreat for telecommunication services. Shares of healthcare companies and consumer staples fell more than 1% on average.
Meanwhile, the technology-driven Nasdaq Composite Index consolidated at 7,747.02, where it was little changed compared with the previous close.
The CBOE Volatility Index, also known as the VIX, rose on Monday following back-to-back declines. The gauge of investor fear edged up 2.8% to 12.32.
OPEC in the Spotlight
The Organization of the Petroleum Exporting Countries (OPEC) will hold its biannual meeting in Vienna, Austria this week, where members are expected to boost production following the yearlong rally in crude prices.
The Saudi-led cartel is reportedly considering an output boost of between 300,000 and 600,000 barrels per day in an effort to maintain market share. However, Iran, Iraq and Venezuela are expected to veto any decision to raise production levels.
“If the Kingdom of Saudi Arabia and Russia want to increase production, this requires unanimity. If the two want to act alone, that’s a breach of the cooperation agreement,” Iran’s OPEC representative told Bloomberg over the weekend.
The Saudis and Russians last month declared their intent to boost output levels at a meeting of energy ministers in Saint Petersburg.
OPEC’s upcoming meeting is scheduled June 22.
Cryptocurrencies Recover Mildly in Afternoon Trade
After flat-lining for most of Monday, cryptocurrency prices edged higher in the afternoon with bitcoin and the ten major altcoins putting up gains.
The cryptocurrency market added roughly $13 billion in value in just over an hour as trading activity picked up across the major exchanges. At the time of writing, the total market for virtual currencies was valued at around $288 billion.
Trading volumes are back up to $12 billion after plummeting to $9.5 billion on Sunday. That marked the lowest turnover in more than two months.
Bitcoin clawed back above the $6,700 handle after falling to the low $6,300 range earlier in the day. Ethereum, the world’s second-largest cryptocurrency by market cap, was back around $520.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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