Stocks closed lower for a second day this week despite a brief comeback with oil prices in late-morning trading.
First, the scoreboard:
- Dow: 17,564.86, -165.65, (-0.93%)
- S&P 500: 2,062.44, -14.63, (-0.70%)
- Nasdaq: 5,095.31, -6.50, (-0.13%)
And now, Tuesday’s top stories:
- Crude oil fell to a new six-year low before regaining some losses. West Texas Intermediate crude oil futures in New York fell 5% to as low as $36.64 per barrel. Brent crude fell below $40 per barrel for the first time since 2009. WTI extended declines that kicked in on Friday as the 12-member oil group OPEC decided not to cut its production level and did not set a production limit.
- There was more bad news for Chipotle as Boston University said that 80 students, up from 30 on Monday, fell ill after they ate at its restaurants. The stock fell by as much as 3% in trading, and has lost some 26% in the last three months. The Centres for Diseases Control and Prevention is investigating E. coli cases linked to Chipotle in several states. But a Chipotle spokesperson said the new cases in Boston were likely the result of norovirus, a gastrointestinal illness that’s easily transmitted through contact with infected food, surfaces, and people.
- Outerwall shares remained sharply lower after a tumble in after-hours trading on Monday. The shares fell 23% after the company slashed its forecast for full-year revenues, as sales from the DVD rental kiosks Redbox drop. The company has been spending a lot on marketing and new content, and that’s eating into profitability right now. With services like Netflix now cheaply available, not that many people are interested in physical discs anymore.
- Small businesses continue to suggest that higher wages are coming. The National Federation of Independent Business’ (NFIB) survey showed that 23% of firms reported an increase in compensation, up two points from October, and near an expansion high. This number has been on an upward trend since the end of the financial crisis.
- Job openings fell a bit in October. The latest Job Openings and Labour Turnover Survey showed that there were 5.4 million openings during the month, down from 5.5 million in September. For a seventh straight month, the quits rate, a gauge of workers’ confidence in the labour market, was unchanged at 1.9%. The report showed “continued labour-market resilience”, according to BNP Paribas’ Derek Lindsey in a client note.
- Morgan Stanley is cutting 1,200 staff, including about 470 front-office staff in its fixed income and commodities business, a person familiar with the situation told Bloomberg. The bank will incur a severance charge of $150 million, as it tries to improve profitability.