Stocks fall as commodity prices slide

Stocks fell heavily Thursday, weighed down by weakness in mining and energy companies as commodities prices slid. Metals including gold and copper dropped to their lowest levels in six years, and oil reached a two-month low.

At the close on Wall Street, the Dow Jones industrial average had given up 254.2 points, about 1.4 percent, to 17,448.1. The Standard & Poor's 500 index lost 29 points, about 1.4 percent, to 2,046. The Nasdaq composite declined 62 points, about 1.2 percent, to 5,005.1.

OIL FALLING: The price of oil slid for the sixth time in seven days and hit its lowest price since late August after the U.S. government said crude stockpiles grew by 4.2 million barrels last week. A private report released Wednesday had showed an even larger increase.

U.S. benchmark crude fell $1.18, or 2.7 percent, to $41.75 a barrel in New York. Brent crude, which is used to price international oils, lost $1.75, or 3.8 percent, to $44.06 a barrel in London.

STRUGGLING STOCKS: Mike McGlone, head of U.S. research for ETF Securities, said investors are coming to grips with the fact that the Federal Reserve is about to start raising interest rates, ending an era of stimulus policies that have boosted stocks. At the same time, stocks could get hurt by warning signs about the U.S. economy, like weak jobs data or disappointing earnings.

"Now we have almost a lose-lose situation" for stocks, McGlone said.

THE BIG PICTURE: October was the best month for the market in four years. The Dow remains down slightly for the year, however, and after a November slump, the S&P 500 is basically unchanged for 2015. The tech-heavy Nasdaq has done better, and is up 6 percent for the year.

METALS SLIDE: Prices for commodities are slumping as investors anticipate that the dollar will get even stronger. Gold declined $3.90 to $1,081 an ounce and silver fell for the tenth consecutive day, losing 3.8 cents to $14.225 an ounce. It's down 11 percent since late October. Copper fell 4.6 cents, or 2.1 percent, to $2.173 a pound. Copper prices have tumbled 23 percent this year.

All three metals are at their lowest prices in six years.

ANALYSTS' OPINION: The central banks of Europe and Japan are both hinting that they will step up stimulus measures. That could make the dollar even stronger compared with the euro and yen. When the dollar appreciates it tends to send prices for oil, copper and other commodities, which are priced in dollars, lower. That's because buyers using other currencies such as the yen and the euro often aren't willing to pay higher prices in their own currency just because the dollar has appreciated.

"Since November hit, the U.S. dollar has gone straight up and these commodities are getting smoked," Ryan Detrick, a markets strategist at Kimble Charting Solutions, said.