64° Good Morning
64° Good Morning

Stocks slip, ending record-setting rally

Traders work on the floor of the New

Traders work on the floor of the New York Stock Exchange during the afternoon of Friday, Sept. 5, 2014, in Manhattan. Credit: Getty Images / Andrew Burton

Financial markets were off Monday, pulling back from a record high reached last week. Energy stocks fell the most as the price of oil slumped. Campbell Soup declined after the company said its 2015 income would miss analysts' expectations. Yahoo, which owns a stake in Alibaba, rose in anticipation of the giant Chinese technology company going public.

At the close on Wall Street, the Dow Jones industrial average fell was down nearly 26 points, or nearly 0.2 percent, to 17,111.4. The Standard & Poor's 500 index lost 6.2 points, or 0.3 percent, to 2,001.5. Only the Nasdaq composite gained 9.4 points, or 0.2 percent, to 4,592.3.

ENERGY: Benchmark U.S. crude oil for October delivery fell 63 cents, or 0.7 percent, to $92.66 a barrel, the lowest price since January. Oil prices have fallen for three days straight as geopolitical worries in Ukraine and Iraq have eased. Also impacting crude oil was a report out of China that showed manufacturing in the world's second-largest economy was slowing down.

While lower oil prices are good for consumers, energy companies could be looking at lower profits if the price of oil remains this low. Seven of the 10 biggest decliners in the S&P 500 were energy companies, primarily smaller oil exploration companies who rely more heavily on high oil prices to justify drilling for oil in remote, expensive places.

Newfield Exploration, EOG Resources, Pioneer Natural Resources and Anadarko all fell 3 percent or more.

"I suspect oil cannot fall further than $90 a barrel," said Paul Christopher, a chief international investment strategist at Wells Fargo Advisors, who focuses on the oil market. "Saudi Arabia and other OPEC members will start cutting production if oil continues to fall like this."

ALI-BUSTER: China's Alibaba Group is seeking to raise up to $24.3 billion from its initial public offering, which would be the largest of all time. Alibaba Group is expected to make its long-awaited debut on the New York Stock Exchange later this month. Yahoo was an early investor in Alibaba and owns 23 percent of the company. Yahoo rose $2.22, or 5.6 percent, to close at $41.81.

LUKEWARM SOUP: Campbell Soup closed down $1.15 cents, or 2.6 percent, at $43.39 after the company reported sales that were weaker than analysts were expecting. Campbell also expects its earnings to be slow next year.

BRITAIN IN FOCUS: The British pound sank to $1.616, its lowest level since November. A YouGov poll showed rising support for Scottish independence, which has made investors nervous. Stocks in London, particularly those with links to Scotland, fell. Britain's FTSE 100 index lost 0.3 percent. "A vote for independence or fear of that outcome may roil financial markets over the next two weeks with the added uncertainty," said Bill Stone, chief investment strategist at PNC Asset Management, in an email.

More news