2 weeks ago
Stock Market

Stocks - Dow Downed by Falling Energy Stocks

Investing.com - The Dow fell for the third-straight day Wednesday as energy stocks were led lower by falling oil prices

Investing.com - The Dow fell for the third-straight day Wednesday as energy stocks were led lower by falling oil prices and a slump in shares of Chesapeake Energy amid concerns about valuation.

The Dow Jones Industrial Average fell 0.52%, the S&P 500 lost 0.66%, while the Nasdaq Composite slumped 0.93%.

Energy stocks fell 1.3%, pressuring the broader market after oil prices slid following a report from the Energy Information Administration showing a larger-than-expected build in crude stockpiles.

Chesapeake Energy (NYSE:CHK) also played a role in the selloff, falling 4% after analyst John Gerdes at MKM Partners flagged valuation concerns, highlighting that the stock trades at an "almost 20% premium" to its peers.

Industrials, meanwhile, were dragged down by General Electric (NYSE:GE) for the second-straight day as Wall Street remained bearish on the conglomerate following CEO Larry Culp's downbeat update on Tuesday.

JPMorgan (NYSE:JPM) analyst Stephen Tusa said his $6 price target on GE looked "generous," given the headwinds the company will face over the next two years, according to CNBC.

"As long as this sentiment prevails, we don't think the stock can bottom," Tusa added.

Culp said Tuesday free cash flow from the company's industrial segment is likely to remain negative this year amid ongoing struggles in its power business.

The Fed's Beige Book, meanwhile, did little to help sentiment as it noted the recent government shutdown weighed on economic activity in "some areas."

The winless streak for the broader market comes as investors await an update on U.S. and China trade talks amid ongoing concerns over a slowdown in global growth.

The Organization for Economic Co-Operation & Development (OECD) said it expects the global economy to grow by 3.3% in 2019 and 3.4% in 2020, down from the forecast of 3.5% for both years issued in November.