Renewed Oil Weakness Rattles U.S. Stocks

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Shares in the U.S. closed lower on Monday, weighed down by falling U.S. crude oil prices. Investor fears are spreading that crude oil and gasoline inventory build-up in the U.S. could trigger another round of supply glut that could damage the price of the commodity. U.S. oil pulled back to trade close to $40 a barrel on Monday.

Besides crude oil pressures, mixed corporate earnings can also be seen impacting U.S. stocks. Investors also continue to digest recent monetary policy statements by the Federal Reserve and the Bank of Japan as they set their eyes on more central meetings in the coming days. Central banks in Australia and Thailand meet this week and it is widely expected that they will all announce interest rate cuts with the hope of spurring growth of domestic economies.

The Fed decided left interest rates unchanged after its July policy meeting and BOJ announced only mild stimulus measures.

How the major indexes performed

The Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI) pulled back 0.2% on Monday after shedding 27.73 points to close at 18404.51. The Dow was particularly weighed down by oil stocks Chevron Corporation (NYSE:CVX) and Exxon Mobil Corporation (NYSE:XOM), which were the largest decliners on the index on Monday in percentage terms. Monday trading saw the Dow enter its sixth consecutive day of declines.

The S&P 500 (INDEXSP:.INX) declined 0.1% after shedding 2.76 points to close at 2170.84. The index was also pulled down by losses in the Energy stocks with Transocean LTD (NYSE:RIG) and Diamond Offshore Drilling Inc (NYSE:DO) leading the sector down. The Energy sector in the S&P 500 fell 3.3%.

However, gains in Technology and Healthcare sectors offset the losses in the Enegy sector. Technology stocks in the S&P 500 rose 0.4% and Healthcare stocks gained 0.6%.

The NASDAQ Composite (INDEXNASDAQ:.IXIC) bucked the trend in the U.S. equity indexes as it rose 0.4% on Monday after adding 22.06 points to close at 5184.20. The Monday trading marked the fifth consecutive session that the tech-weighted index closed higher.

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