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Investing.com – Wall Street ended the session near the lows of the day, led by a slide in energy as oil prices slipped into negative territory for the first time ever, as many fret over storage capacity constraints at a time when the Covid-19 pandemic has hit demand.
The Dow fell 2.4%, or 594 points, the S&P 500 slipped 1.8% and the Nasdaq Composite lost 1%.
Energy stocks led the broader market lower, paced by a decline in the price of oil for delivery in May, which settled below zero for the first ever, amid weaker demand and fast-paced selling by speculators scrambling to sell long positions to avoid owning tacking physical delivery.
“Cushing is landlocked and stocks look likely to be full within 3 weeks,” said Chris Midgley at S&P Global Platts. “This weekend saw the price of WTI futures crash as traders had to sell long positions to avoid being caught having to deliver physical oil into the contract when there is no storage available.”
The slump in oil prices proved of little respite for airline stocks the sector is not expected to make a quick recovery amid uncertainty about how long the Covid-19 pandemic measures remain in place.
But there was some reason for optimism.
In New York state intubations fell by 32 compared with a 152 decline yesterday, while total hospitalizations were about flat compared with a total of 1384 a day earlier, according to New York Gov. Andrew Cuomo. The Covid-19 curve in New York is “off of the plateau and now starting a descent,” he added.
Also weighing on the broader market, defensive corners of the market like utilities, and real estate fell nearly 4%.
Corporate earnings, meanwhile, underscored the impact from the coronavirus, which has killed about 168,000 and infected nearly 2.5 million worldwide.
United Airlines (NASDAQ:UAL) dropped 4.4% after warning of a $2.1 billion loss in the first quarter as revenue fell 17% to $8.0 billion amid a plunge in travel.
Elsewhere, Boeing (NYSE:BA) slumped 6.6% as China Development Bank Financial Leasing pulled its an order for 29 Boeing Co . 737 Max planes, worth at least $2.9 billion.
In sharp contrast, stocks that are expected to benefit from the current lockdown measures continued to climb, with Roku (NASDAQ:ROKU), Netflix (NASDAQ:NFLX), and Amazon.com (NASDAQ:AMZN) ended the day in the green.
