Tag Archives: Economy

Snyder: 2016 shaping up to be bleak year for global economy

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Global economic trends suggest a bleak economic outlook for the remainder of the year, according to a new blog post from frequent Jim Bakker Show guest Michael Snyder.

Writing for his blog, “The Economic Collapse,” Snyder recently published a list of 22 signs that suggest January is only the beginning of what could be a rough year for the global economy.

Items on the list range from store closures and layoffs to slumping oil prices and bank decisions.

“Each one by itself would be reason for concern, but when you put all of the pieces together it creates a picture that is hard to deny,” Snyder wrote in his blog. “The global economy is in crisis, and this is going to have very serious implications for the financial markets moving forward.”

Snyder wrote recent trends indicate 2016 “is going to get progressively worse as it goes along.”

Click here to read Snyder’s full list on “The Economic Collapse.”

 

Growth worries, rate hike uncertainty pull Wall Street down

(Reuters) – U.S. stocks dropped on Monday as concern over global growth hit banks and other economically sensitive shares, although a late rally in energy shares left the market well above its lows of the day.

European banks led a global selloff in financial stocks as signs of stress in the sector mounted.

Uncertainty over whether the Federal Reserve would raise rates this year also dragged down U.S. bank stocks, pushing the S&P financial index down 2.6 percent.

The index is off 14.6 percent for the year, the worst-performing of the 10 major S&P sectors. It is down more than 20 percent from its July 2015 high, confirming the sector is in the grip of a bear market.

“Investors’ attitudes seem to be worsening relative to the likelihood of a global recession. I think that’s what financials are reflecting – that their net interest margins are going to be further compressed under collapsing bond yields,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

The yield on the 10-year Treasury note fell to a one-year low.

Shares of Morgan Stanley slid 6.9 percent in their largest one-day drop since November 2012, while rival Goldman Sachs fell 4.6 percent. Both closed at their lowest since 2013.

Facebook Inc, Amazon.com Inc and other technology stocks that had lent strength to the market last year extended their decline from Friday. Fund managers said last year’s outsized gains among some Internet stocks made them the first choice to sell now.

Sharp selling in the beaten-down energy sector reversed late in the session, leaving the S&P energy index  up 0.1 percent and S&P 500 well off its lows of the day.

But Chesapeake Energy ended down 33.3 percent at $2.04 after sources told Reuters that the natural gas company had tapped existing adviser Kirkland & Ellis to explore restructuring options. Chesapeake said it has no plans to pursue a bankruptcy.

The Dow Jones industrial average closed down 177.92 points, or 1.1 percent, at 16,027.05, the S&P 500 lost 26.61 points, or 1.42 percent, to end at 1,853.44 and the Nasdaq Composite dropped 79.39 points, or 1.82 percent, to 4,283.75.

Falling oil prices along with concern over a worsening global growth outlook have caused a sharp selloff in stocks this year. Investors have been searching for a catalyst that might change the market’s course.

“I don’t know if we’ve seen any tangible evidence of a turn in any macro economic conditions that would warrant a firm bottoming,” Luschini said, noting the selloff in financials.

Adding to recent woes for the tech sector, Cognizant dropped 7.7 percent to $54.05 after the IT services provider issued a weak sales forecast.

Amazon fell 2.8 percent while Facebook dropped 4.2 percent.

Volume was heavy. About 10.6 billion shares changed hands on U.S. exchanges, above the 9.4 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Declining issues outnumbered advancing ones on the NYSE by 2,484 to 618; on the Nasdaq, 2,029 issues fell and 804 advanced. The S&P 500 posted 7 new 52-week highs and 97 new lows; the Nasdaq recorded 4 new highs and 495 new lows.

(Additional reporting by Abhiram Nandakumar in Bengaluru and Marcus E. Howard in New York; Editing by Savio D’Souza, Nick Zieminski and Bill Rigby)

U.S. inflation survey tumbles in red flag for Fed

NEW YORK (Reuters) – An increasingly important gauge of U.S. inflation tumbled last month to its lowest level since the Federal Reserve Bank of New York began the survey in mid-2013, in what could be taken as another warning bell for the U.S. central bank.

The New York Fed’s survey of consumers found expectations for inflation one and three years in the future fell as Americans were more cognizant of lower gasoline prices and costs of medical care and college.

One-year median expectations have fallen three months running and hit 2.42 percent in January, from 2.54 percent in December. The three-year ahead prediction was 2.45 percent last month, well down from 2.78 percent the previous month.

Respondents on the younger and older ends of the range, and those with lower education and income, drove the decline, said the New York Fed, whose survey has been increasingly cited by economists and central bankers themselves as a read on when inflation will return to a 2-percent target.

The Fed raised rates in December and aims to keep tightening. But a market selloff in January and worries over a global slowdown has some Fed officials worried that inflation, at 1.4 percent now according to their preferred measure, will not rebound as soon as desired.

The internet-based survey taps a rotating panel of 1,200 household heads, and is done by an outside organization.

(Reporting by Jonathan Spicer; Editing by Andrea Ricci)

Nasdaq ends week at lowest level since October 2014

(Reuters) – The Nasdaq closed at its lowest since October 2014 on Friday, leading a selloff on Wall Street following weak forecasts from technology companies including LinkedIn.

LinkedIn dropped 43.6 percent to $108.38, a day after the company’s revenue forecast missed estimates.

Business analytics company Tableau Software lost half its market value and its shares hit an all-time low a day after it cut its full-year earnings forecast. Its shares ended down 49.4 percent at $41.33.

Big tech names also sank, including Facebook, which dropped 5.8 percent to $104.07. Alphabet fell 3.6 percent to $703.76 and Amazon slid 6.4 percent to $502.13. Netflix was down 7.7 percent at $82.79.

Stocks like Amazon and Netflix, which both more than doubled in price last year, have been favorites with hedge funds. Friday’s action may suggest some hedge funds may be taking a harder look at valuations.

“Tech has got a few shining examples of what happens if you disappoint,” said Art Hogan, chief market strategist at Wunderlich Securities in New York. “When that happens, that calls into question the valuations of all high-multiple stocks.”

The Dow Jones industrial average closed down 211.75 points, or 1.29 percent, to 16,204.83, the S&P 500 lost 35.43 points, or 1.85 percent, to 1,880.02 and the Nasdaq Composite dropped 146.42 points, or 3.25 percent, to 4,363.14.

Friday’s January jobs report non-farm payrolls increased by 151,000 jobs, below the 190,000 expected by economists polled by Reuters as the boost to hiring from unseasonably mild weather faded. But strong wage growth and falling unemployment suggested a March interest rate increase could not be completely ruled out.

Declining issues outnumbered advancing ones on the NYSE by 2,330 to 720, for a 3.24-to-1 ratio on the downside; on the Nasdaq, 2,288 issues fell and 509 advanced for a 4.50-to-1 ratio favoring decliners.

The S&P 500 posted 7 new 52-week highs and 26 new lows; the Nasdaq recorded 3 new highs and 195 new lows.

(Additional reporting by Saqib Ahmed in New York; Editing by Nick Zieminski and Dan Grebler)

U.S. unemployment rate hits eight-year low

WASHINGTON (Reuters) – U.S. employment gains slowed more than expected in January as the boost to hiring from unseasonably mild weather faded, but rising wages and an unemployment rate at an eight-year low suggested the labor market recovery remains firm.

Non-farm payrolls increased by 151,000 jobs and the unemployment rate slipped one-tenth of a percentage point to 4.9 percent, the lowest since February 2008, the Labor Department said on Friday. The payrolls gain was a sharp step-down from the average 231,000 jobs per month during the fourth quarter.

“The fact that payroll gains fell back to earth is not necessarily a bad sign. Most indications are that the job market in the U.S. is on solid footing and improving,” said Nariman Behravesh, chief economist at IHS in Lexington, Massachusetts.

Economists had forecast employment increasing by 190,000 in January and the jobless rate steady at 5 percent. The economy added 2,000 fewer jobs in November and December than previously reported.

On top of a 0.5 percent jump in average hourly earnings, which was the biggest gain in a year, employers increased hours for workers. Manufacturing, which has been undermined by a strong dollar and weak global demand, added the most jobs since August 2013.

Economists said the combination of strong wage growth and falling unemployment suggested a March interest rate increase from the Federal Reserve could not be completely ruled out.

The dollar rose against a basket of six major currencies on the data after hitting a roughly 15-week low on Thursday. Prices for U.S. government debt initially fell, but pared losses as stocks on Wall Street extended their decline.

“The lower unemployment rate and rising wages further support the view that the labor market is doing nothing but tightening,” said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. “Clearly, there are more uncertainties today than when the Fed raised rates in December and hinted that there could be four increases this year. But the labor market is absolutely not one of them.”

Tightening financial market conditions and signs that both the domestic and global economies were slowing had undercut the case for a Fed rate hike next month and lowered the probability of monetary policy tightening this year.

The U.S. central bank raised its short-term interest rate in December for the first time in nearly a decade.

Federal Reserve Chair Janet Yellen has said the economy needs to create just under 100,000 jobs a month to keep up with growth in the working-age population.

The economy, especially voters’ perceptions of their job prospects, will likely be an issue in the November elections. President Barack Obama lauded the labor market progress.

“This progress is finally starting to translate into bigger paychecks. The United States of America right now has the strongest, most durable economy in the world,” Obama told reporters at the White House.

Republican National Committee chairman Reince Priebus, however, said the economy was “still failing the millions of Americans who have given up looking for work.”

WEATHER PAYBACK

January’s softer job gains were payback after the warmest temperatures in years bolstered hiring in weather-sensitive sectors like construction. January employment also lost the lift from the hiring of couriers and messengers, which was buoyed in November and December by strong online holiday sales.

The economy grew at a 0.7 percent annual rate in the fourth quarter, restrained by headwinds that included the strong dollar and efforts by businesses to sell off inventory.

A separate report from the Commerce Department showed the buoyant dollar cutting into exports in December, causing the trade deficit to widen 2.7 percent to $43.4 billion.

In January, the unemployment rate fell even as more people entered the labor force. The labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job rose one-tenth of a percentage point to 62.7 percent. It remains near four-decade lows.

Low participation could crimp job growth as the supply of labor shrinks, unless a strong rise in wages lures more people back into the labor force. The private sector accounted for all employment gains in January, adding 158,000 positions.

The services sector created 118,000 jobs, the fewest in 10 months. That was because temporary help services fell 25,200 and courier and messenger employment declined by 14,400 jobs. Hiring in these categories normally rises during the holiday season.

Educational services lost 38,500 jobs, but retail payrolls added a strong 57,700 positions. Hiring could slow in the months ahead after a number of retailers, including Walmart <WMT.N> and Macy’s <M.N> announced dozens of store closures.

The embattled manufacturing sector surprisingly added 29,000 jobs last month, while mining laid off 7,000 more workers. Mining payrolls have decreased by 146,000 since peaking in September 2014. About three-fourths of the job losses over this period have been in support activities for mining.

Further losses are likely after a report on Thursday showed energy firms in January announced plans to lay off 20,246 workers. Oil prices have plunged about 70 percent in the last 18 months, forcing firms like oilfield services provider Schlumberger <SLB.N> to slash their workforces.

Construction payrolls rose 18,000, cooling off after adding 146,000 jobs in the fourth quarter. Government employment fell 7,000.

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

U.S. stocks rise for second day; materials a boost

(Reuters) – A jump in materials shares helped U.S. stocks eke out a second straight day of gains on Thursday, though disappointing forecasts from retailers and anxiety ahead of Friday’s jobs report limited the advance.

The S&P 500 materials index rose 2.8 percent, leading the day’s gains, as declines in the U.S. dollar lifted copper and other metals prices.

The dollar index fell for a fourth day on the latest batch of soft U.S. data, which dampened expectations for U.S. interest rate hikes this year. A weaker dollar benefits big U.S. companies that depend on overseas sales.

Data showed non-farm productivity fell in the fourth quarter at its fastest pace in more than a year, while new orders for U.S. factory goods also fell in December by the most in a year.

The weaker data came ahead of Friday’s key monthly jobs report from the U.S. government, which is expected to show 190,000 non-farm jobs added in January.

Adam Sarhan, chief executive of Sarhan Capital in New York, said the market is trying to bounce from “deeply oversold” levels, but is struggling because of continued weakness in earnings and economic data.

“We’re now seeing a lot of weaker-than-expected economic data coming out,” he said. “The bullish catalyst just isn’t there to justify further rate hikes.”

The Dow Jones industrial average rose 79.92 points, or 0.49 percent, to end at 16,416.58, the S&P 500 gained 2.92 points, or 0.15 percent, to 1,915.45 and the Nasdaq Composite added 5.32 points, or 0.12 percent, to 4,509.56.

Consumer-related shares were among the day’s biggest losers in the S&P 500 after retailers Ralph Lauren and Kohl’s warned of a tough year ahead. Ralph Lauren sank 22.2 percent to $89.95 while Kohl’s fell 18.8 percent to $41.52, the two biggest percentage decliners in the S&P 500.

The consumer discretionary index was down 0.6 percent, while S&P staples was down 0.9 percent.

Stocks have had a rough start to 2016, hurt by tepid U.S. growth, falling oil prices and concern that the world faces a China-led slowdown.

UBS cut its year-end target and trimmed its earnings estimate for the S&P 500 on the weaker U.S. growth prospects.

Fourth-quarter S&P 500 earnings are expected to have fallen 4.2 percent from a year earlier, according to Thomson Reuters data.

GoPro fell 8.7 percent to $9.78 after the camera maker forecast current-quarter revenue below analysts’ estimates.

After the bell, shares of LinkedIn dropped 24 percent following the networking site operator’s results and forecast.

About 9.5 billion shares changed hands on U.S. exchanges, compared with the 9.4 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Advancing issues outnumbered declining ones on the NYSE by 1,949 to 1,087, for a 1.79-to-1 ratio on the upside; on the Nasdaq, 1,659 issues rose and 1,123 fell for a 1.48-to-1 ratio favoring advancers.

The S&P 500 posted 11 new 52-week highs and 11 new lows; the Nasdaq recorded 14 new highs and 83 new lows.

(Additional reporting by Tanya Agrawal; Editing by Don Sebastian and Nick Zieminski)

Rising U.S. layoffs point to ebbing labor market momentum

WASHINGTON (Reuters) – The number of Americans filing for unemployment benefits rose more than expected last week, suggesting some loss of momentum in the labor market amid a sharp economic slowdown and stock market selloff.

Signs of creeping employment weakness were also flagged by another report on Thursday showing a 218 percent jump in announced job cuts by U.S.-based employers in January. The planned layoffs were concentrated in the energy and retail sectors.

“The future is somewhat darker … the labor market may be past its peak for this cycle. It looks like the labor market has scaled back its rapid advance last month,” said Chris Rupkey, chief economist at MUFG Union Bank in New York.

Initial claims for state unemployment benefits increased 8,000 to a seasonally adjusted 285,000 for the week ended Jan. 30, the Labor Department said.

Still, claims remained below 300,000, a level associated with strong labor market conditions, for the 48th straight week. That is the longest run since the early 1970s.

The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, rose 2,000 to 284,750 last week. Economists had forecast claims rising to 280,000 in the latest week.

The rise in layoffs came amid a slowdown in economic growth. The economy grew at only a 0.7 percent annual pace in the fourth quarter, held back by the headwinds of a strong dollar and faltering global demand.

A downturn in capital spending by energy companies, reeling from a collapse in oil prices, and inventory destocking by businesses are also constraining growth. At the same time, a stock market rout sparked by fears of a global economic slump has caused financial market conditions to tighten.

In a separate report, global outplacement consultancy Challenger, Gray & Christmas said employers reported 75,114 planned job cuts last month, up from December’s 15-year low of 23,622. Last month’s planned layoffs were the largest since July.

Retailers announced plans to eliminate 22,246 jobs from their payrolls, the most since January 2009. The retail cuts were dominated by Walmart <WMT.N>, which announced plans to close 269 stores worldwide. The downtrodden energy sector announced plans to reduce its headcount by 20,246, up from 1,682 in December.

“It remains unclear how much of the deterioration in the data is related to an unfavorable shift in the weather and an increase in layoffs of temporary workers following the holiday season,” said Daniel Silver, an economist at JPMorgan in New York.

In a third report, the Commerce Department reported that new orders for manufactured goods fell 2.9 percent in December, the largest drop in a year, after falling 0.7 percent in November.

The reports came on the heels of weak data on export growth and consumer spending that suggest the Federal Reserve will probably not raise interest rates in March. The U.S. central bank raised its short-term interest rate in December for the first time in nearly a decade.

U.S. stock indexes rose, while prices for Treasuries were mixed. The dollar fell against a basket of currencies, touching a 15-week low against the euro and a two-week low against the yen.

PRODUCTIVITY WEAK

While the claims data has no bearing on January’s employment report, which is scheduled to be released on Friday, as it falls outside the survey period, it fits in with perceptions of a deceleration in the pace of job growth.

According to a Reuters survey of economists, nonfarm payrolls are expected to have increased 190,000 last month after surging by 292,000 in December. The unemployment rate is forecast holding steady at a 7-1/2-year low of 5 percent.

In another report on Thursday, the Labor Department said nonfarm productivity, which measures hourly output per worker, declined at a 3.0 percent rate, the biggest drop since the first quarter of 2014, after rising at a 2.1 percent rate in the third quarter.

The weak productivity data reflected the sharp slowdown in GDP growth during the quarter and an acceleration in the pace of hiring. Nonfarm payrolls rose by an average 284,000 jobs per month.

Productivity grew 0.6 percent in 2015, the smallest increase since 2013, and has increased at an annual rate of less than 1.0 percent in each of the last five years. Economists blame softer productivity on a lack of investment, which they say has led to an unprecedented decline in capital intensity.

In the fourth quarter, unit labor costs, the price of labor per single unit of output, advanced at a 4.5 percent pace, the fastest rate in a year. They rose 2.4 percent in 2015, the largest gain since 2007.

(Reporting by Lucia Mutikani; Editing by Paul Simao)

Dow, S&P 500 rally with energy, Alphabet drops

(Reuters) – U.S. stocks staged a late-day rally on Wednesday as an 8-percent jump in oil prices lifted beaten-down energy shares and financials rebounded.

The Nasdaq stayed weaker but ended well off the day’s lows.

Oil prices snapped a two-day rout as investors took advantage of a weaker U.S. dollar. Comments by Russia’s foreign minister reignited hopes of a deal among oil producers to trim output. The energy index jumped 4 percent.

“What (markets) are keying off of is the move in commodities and in the dollar,” said Walter Todd, chief investment officer at Greenwood Capital Associates in Greenwood, South Carolina. “That is driving the rotation in the equity market out of momentum names into commodity-based names.”

Alphabet shares tumbled 4 percent to $749.38 and the company moved back below Apple in market capitalization. Apple, the world’s most valuable company, rose 2 percent at $96.35.

Alphabet’s selloff may be a combination of broad-based weakness in tech stocks that are trading at high valuations and the departure of Amit Singhal as senior vice president of the company’s search business, said Kevin Kelly, chief investment officer for Recon Capital Partners.

“That was a little surprising, especially this close after earnings,” he said, referring to Singhal’s departure.

The Dow Jones industrial average ended up 183.12 points, or 1.13 percent, to 16,336.66, the S&P 500 gained 9.5 points, or 0.5 percent, to 1,912.53 and the Nasdaq Composite dropped 12.71 points, or 0.28 percent, to 4,504.24.

Other high-flying tech names that fell on Wednesday included Amazon, down 3.8 percent at $531.07.

The dollar’s decline may have eased worries about the impact of dollar strength on U.S. multinationals’ earnings. Shares of 3M Co., up 3.1 percent at $152.52, led gains in the Dow.

The S&P materials was up 3.3 percent, the day’s second-best performing sector. The S&P financial index ended down just 0.1 percent after hitting its lowest in more than two years.

Stocks’ late-day rally reversed sharp losses in morning trading. U.S. data showed the economy’s service sector expanded at a slower-than-expected rate, raising concerns that weakness in manufacturing was spreading to other areas of the economy.

In other economic news, ADP data showed private employers added more jobs than expected in January. The data comes ahead of the government’s more comprehensive employment report on Friday.

Tepid U.S. growth, falling oil prices, and fears regarding a China-led global slowdown have combined to drive stocks down sharply since the start of the year.

After the bell, CBS Corp said media mogul Sumner Redstone had resigned as executive chairman. Shares of Viacom Inc, where Redstone is also chairman, shot up 10.6 percent to $49.40. CBS shares also were up.

During the session, about 10.2 billion shares changed hands on U.S. exchanges, above the 9.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Advancing issues outnumbered decliners on the NYSE 1,920 to 1,102; on the Nasdaq, 1,393 issues fell and 1,391 advanced. The S&P 500 posted 22 new 52-week highs and 56 new lows; the Nasdaq recorded 16 new highs and 236 new lows.

(Additional reporting by Saqib Ahmed and Lewis Krauskopf in New York; Editing by Richard Chang and James Dalgleish)

U.S. CEOs unleash recession fears in earnings calls

NEW YORK (Reuters) – U.S. companies are growing more concerned about the prospects of a recession in the year ahead for the first time since the end of the financial crisis.

So far this year, the number of companies whose executives have mentioned recession concerns to analysts and investors is up 33 percent from the same period a year ago; the first such increase since 2009. Some 92 companies have discussed a U.S. recession in their earnings calls, according to Thomson Reuters data.

That gloomy talk highlights worries that growth in the world’s largest economy may be coming to a halt. Gross domestic product grew 0.7 percent in the final quarter of 2015, down from 2 percent in the third quarter, while double the number of companies are cutting or flat-lining their capital spending in the year ahead, according to Reuters data. The benchmark S&P 500, a leading indicator of economic strength, had its worst January since 2009 as oil tumbled below $30 a barrel and remained near 12-year lows.

While nearly all companies that have discussed recession say that U.S. consumers continue to look healthy, many are growing concerned that the steep declines in energy prices and job cuts in the industry are going to bleed into the larger economy. Overall, economists expect the U.S. economy to grow 2.4 percent in 2016, according to a Dec. 30 Reuters poll.

Richard Fairbank, chief executive of Capital One Financial Co., for example, said he sees a recession as increasingly likely if financial market turmoil spreads into the real economy.

“Obviously, the economy is something of a wild card,” he said.

“Perhaps the consumer economy is doing okay, but there is a depression in the energy economy and it feels like there is a general malaise if not a recession looming in the industrial and manufacturing economies,” David Grzebinski, chief executive of tank barge operator Kirby Co told analysts.

And household hardware maker Stanley Black & Decker Inc chief financial officer Don Allan told analysts that the company was prepared to cut jobs and pullback spending in the event of a slowdown.

Not every company was downcast, however. Trucking operator Swift Transportation Co told analysts that one of its larger customers plans to spend $1.6 billion this year, up from $900 million last year.

“These numbers are not signaling, to us, a consumer recession,” said CEO Jerry Moyes.

(Reporting by David Randall; Editing by Meredith Mazzilli)

Wall Street slides with Exxon, oil

(Reuters) – U.S. stocks dropped on Tuesday after another steep fall in oil prices and a disappointing spending forecast from Exxon Mobil.

Shares of Exxon fell 2.2 percent to $74.59 after the oil major reported its smallest quarterly profit in more than a decade, forecast a 25-percent drop in capital spending from 2015 levels and suspended share repurchases.

With Exxon, “not only did the earnings disappoint people, but the fact that they slashed capex so much and they (suspended) their share repurchase program. It’s a good indication that one more large oil company is not seeing an improvement in the environment,” said Michael O’Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut.

Data so far this earnings period shows the capital spending slump that originated in the hard-hit energy sector was spreading more widely across other U.S. industries.

Earlier Tuesday, BP Plc reported an annual loss of $6.5 billion, its largest ever.

The S&P energy index slid 3.3 percent, the biggest drag on the S&P 500. Oil prices slid sharply as hopes faded for a deal between OPEC and Russia to cut output. The S&P utility index rose 0.4 percent, the only sector to end in positive territory.

The Dow Jones industrial average closed down 295.64 points, or 1.8 percent, to 16,153.54, the S&P 500 lost 36.35 points, or 1.87 percent, to 1,903.03 and the Nasdaq Composite dropped 103.42 points, or 2.24 percent, to 4,516.95.

The Dow Jones transportation average ended 2.9 percent lower following news of the first U.S. transmission of the Zika virus.

The S&P 500 is down 6.9 percent since the start of the year. Investors have been concerned about a China-led global economic slowdown, tepid U.S. economic data, the pace of interest rate hikes by the Federal Reserve and weak earnings. Fourth-quarter S&P 500 earnings are expected to have fallen 4.4 percent from a year earlier, according to Thomson Reuters data.

Bucking the day’s trend, Alphabet was up 1.3 percent at $780.91. Quarterly profit beat estimates late Monday and the Internet major surpassed Apple as the most valuable U.S. company.

After the bell, shares of Chipotle fell 3 percent after it reported its first fall in quarterly sales at established restaurants since it went public. The stock ended the regular session up 0.6 percent at $475.67.

Also, Yahoo dipped 1 percent in extended trading following its results.

Investors are keeping an eye on the U.S. election cycle. Iowa results created greater uncertainty because there were no clear winners, said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.

“The bottom line for people who are investing is they prefer a little more certainty than they are seeing right now in either the election or in the energy markets,” he said.

About 8.5 billion shares changed hands on U.S. exchanges, below the 9.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.

NYSE declining issues outnumbered advancers 2,478 to 603 and on the Nasdaq, 2,237 issues fell and 577 advanced. The S&P 500 posted 15 new 52-week highs and 28 lows; the Nasdaq recorded 22 new highs and 143 lows.

(Additional reporting by Tanya Agrawal and Lewis Krauskopf; Editing by Nick Zieminski and James Dalgleish)