Market Watch: Energy Stocks Continue to Lose $

Energy stocks- specifically oil- put a damper on today’s meager market gains.  The price of oil dropped another 3.3% settling below $29 a barrel.  The International Energy Agency, which advises industrialized countries on energy policy, said the overstock of oil would last until at least the end of this year.  The IEA said the global oil demand fell to a one-year low in the last quarter of last year.  The International Monetary Fund said it still has concerns about the global economy, which caused it to reduce its overall growth forecast for the next two years. This is its third cut to global growth forecasts in less than a year.

IMF economist Maurice Obstfeld told CNBC’s “Worldwide Exchange-

“They’re facing continuing challenges from low commodity prices, in particular oil prices” and geopolitical tensions in some countries. The U.S. is also behind the downgrade, Obstfeld added, citing two main points: “The very strong strengthening of the dollar, which has been putting pressure on manufacturing and trade, … and the response of investment in the energy sector, associated with low oil prices.”

A new government report estimates that this year’s budget deficit will rise to $544 billion, an increase over prior estimates that can be attributed largely to tax cuts and spending increases passed by Congress last month. The estimate from the Congressional Budget Office also sees the economy growing at a significantly slower pace this year than it predicted just a few months ago. It projects the economic growth will slow to 2.7 percent this year; it foresaw 3.0 percent growth in 2016 in last summer’s prediction. Over the coming decade, CBO predicts deficits totaling $9.4 trillion dollars.  Also today came word that China’s economy slowed down even further in the 4th quarter of 2015, dragging last year’s full-year growth to a 25 year low. China’s economy grew 6.9 percent in 2015, down from 7.3 percent in 2014. For the October-December quarter, growth inched down to 6.8 percent, the weakest quarterly expansion in 6 years.

Here are the final numbers from Tuesday, 1/19/16 on Wall Street.

Dow Jones Industrial Average: 16,016.02  (+27.94/ +0.17%)

NASDAQ: 4,476.95  (-11.47/ -0.26%)

S&P 500: 1,881.33  (+1.00 / +0.05%)

Phil Cannella

Phil Cannella

As a partner with CBS Radio in Philadelphia, Phil Cannella reports on the issues most important to the American retiree.
Phil Cannella
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Phil Cannella
Phil Cannella
Phil Cannella

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