US stocks fell to six week lows amid falling commodity prices, while investors are waiting for the first in many years rising of interest rates in the United States, reported Bloomberg.
Standard & Poor's 500 finished down six of the last seven trading sessions, and now its decline since the beginning of the current year is 0.6%, says MarketWatch.
The extra incentives, including zero interest rate, are no longer needed for the US economy, which is almost recovered to the normal state, said the president of the St. Louis Federal Reserve Bank (FRB), James Bullard, who is not a voting member of the Federal Open Market Committee (FOMC) in this year. He is considered one of the most active supporters of the rate increase.
Meanwhile, his colleague from the Federal Reserve Bank of Chicago, Charles Evans, who has softer positions and votes in the FOMC this year, said on Thursday that regardless of the timing of first rate hike, the Fed has to make it clear that the subsequent increase in the cost of borrowing will not be sharp.
All ten industry groups of S&P 500 showed a decline at the end of Thursday trading, the leaders of falling being commodity companies. The Bloomberg index, which includes 22 commodities, fell to its lowest level since 1999 due to the continued decrease in demand from China and a strengthening US dollar.
Index of Dow Jones Industrial Average fell on Thursday by 254.15 points (1.44%), to 17 448.07 points.
Standard & Poor's 500 at the end of trading dropped by 29.03 points (1.4%) and amounted to 2045.97 points.
The value of Nasdaq Composite fell 61.94 points (1.22%) to 5005.08 points.
In particular, there declined the stock prices of Chevron (2.5%) and Exxon Mobil (N: XOM) (2.7%).
The price of Freeport-McMoRan Inc. shares, a mining company, fell 5.8%, to its lowest level since August 26.
Capitalization of aluminum giant – Alcoa fell 3.2%, the lowest level in two years.
Among the 30 companies included in the calculation of Dow Jones, the most significant drop in share prices showed the world's largest manufacturer of road construction equipment – Caterpillar (4.5%).
Among the companies that already presented their reports, approximately 73% had better than expected earnings, but revenue was in 56% cases lower than expected.