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BUSINESSThursday 14 January 2016
Stocks plunge; S&P 500 down 10% from November peak CSX predicts 2016
a tough year for
ALEX VEIGA bate. Are we gaining the percent, to 1,890.28. It was hold for long, however, as railroad industry
AP Business Writer momentum in the econo- the worst day for the index oil prices began to swoon
It’s been a turbulent ride my to justify the valuation in since Sept. 28. following a report show- JOSH FUNK
for stock market investors the market?” The Nasdaq slid 159.85 ing that demand for fuels AP Business Writer
this year and it got worse Energy and consumer points, or 3.4 percent, to slipped last week. Inves- OMAHA, Neb. (AP) — CSX
Wednesday. stocks bore the brunt of 4,526.06. tors also began size up to Corp. expects lower profits
A broad downturn in U.S. the selling on Wednesday. All the sectors in the S&P discouraging earnings out- in 2016 as weak demand
stocks on another volatile for coal and crude oil per-
day for crude oil prices Trader George Ettinger, right, works on the floor of the New York Stock Exchange, Wednesday, Jan. sists and the strong U.S.
knocked the Standard & 13, 2016. It’s been a turbulent ride for stock market investors this year and it got worse Wednesday. dollar continues to limit ex-
Poor’s 500 index down 10 ports.
percent from its November (AP Photo/Richard Drew) The railroad discussed its
peak. outlook for lower freight
That’s known as a correc- The price of U.S. crude oil 500 index ended sharply looks from Ford Motor and volume and a difficult year
tion on Wall Street, and it’s closed slightly higher, but lower, with consumer dis- auto parts supplier Borg- on Wednesday — one day
the second time in less than remains near $30 a barrel, cretionary stocks faring the Warner. Ford fell 65 cents, after releasing its fourth-
five months for the S&P 500 a level that investors fear worst, down 3.4 percent. or 5.1 percent, to $12.20. quarter results.
index, which is regarded as could force many oil and Biotechnology stocks also BorgWarner lost $3.56, or Chairman and CEO Mi-
the bellwether for the stock gas company to go bank- took a drubbing. The Nas- 9.5 percent, to $33.84. chael Ward said the rail-
market. rupt. Brent crude, the in- daq Biotechnology index Railroad operator CSX and road will continue working
The Dow Jones industrial ternational standard, fell 2 lost 5.3 percent and is down supermarket chain Super- to improve productivity
average also tumbled, los- percent. Some of the big- 17.2 percent this year. Valu also ended lower and cut about $200 million
ing more than 300 points gest winners from last year, The market was coming off after the companies re- in expenses in 2016, but it’s
before closing within 25 such as Netflix and Ama- its best day this year and ported their latest quarterly hard to predict what the
points of its own correction zon, both of which doubled appeared to be headed results. CSX slid $1.35, or 5.7 industrial economy will do
level. in value in 2015, also fell for more gains early in the percent, to $22.35. Super- this year.
The rocky start to the year sharply. “The momentum day. A report showing that Valu fell 93 cents, or 15.5 CSX also plans to reduce its
reflects mounting wor- names that drove this mar- China’s exports fell less percent, to $5.08. capital spending this year
ries on Wall Street about ket higher have just been than expected in Novem- Benchmark U.S. crude by $100 million to $2.4 bil-
a slowdown in the global clobbered,” Krosby said. ber helped lift the market. edged up 4 cents to close lion.
economy, plunging oil All told, the Dow lost 364.81 The price of crude oil re- at $30.48 a barrel in New “2016 will be a more chal-
prices and the implications points, or 2.2 percent, to bounded more than 3 per- York. U.S. crude is down 18 lenging year,” Ward said.
for U.S. companies. It also 16,151.41. The S&P 500 in- cent in the first hour of regu- percent so far this year. q “Volume in the first quar-
deepens the pain for many dex fell 48.40 points, or 2.5 lar trading. The trend didn’t ter and for the full year will
investors after a flat year of decline as growth in some
returns for the stock market markets continues to be
last year. offset by the significant
The S&P 500 index is now impact of continued coal
down 7.5 percent this declines, low commodity
year, while the Dow is off prices and a strong US dol-
7.3 percent. The Nasdaq lar.”
is deeper in the red, down The Jacksonville, Florida-
9.6 percent. The Russell based railroad said Tues-
2000, which is comprised day its fourth-quarter profit
of small-company stocks, is declined 5 percent to $466
now down 20 percent from million, or 48 cents per
its June peak. That big a share, on $2.78 billion rev-
plunge is defined as a bear enue.
market. “At the very core The quarterly results were
of this there’s a bull-bear helped by a one-time
debate,” said Quincy Kros- property sale that added
by, market strategist at Pru- $80 million, or 5 cents per
dential Financial. “Whether share, to CSX’s profit. An-
or not we’re headed into alysts surveyed by Zacks
a recession. That’s the de- Investment Research ex-
pected adjusted earnings
MetLife mulls IPO of life insurance business of 46 cents per share.
Citi analyst Christian Weth-
NEW YORK (AP) — MetLife That categorization makes requirements. rest of the management erbee said the railroad’s
plans to carve off a sub- it subject to greater gov- It said the potential stand- team to be named over results were better than he
stantial portion of its U.S. ernment oversight and, alone business would have time. MetLife would keep its expected thanks to tight
life insurance business via MetLife says, exorbitant about $240 billion in total property-casualty, foreign cost controls.
a sale, spinoff or an initial costs. It has taken the Fi- assets and represent about and other businesses under Coal demand has fallen
public offering as the par- nancial Stability Oversight 20 percent of its operat- the proposed plan. It said significantly over the past
ent company challenges Council to court over the ing earnings. For the nine it would remain a leader several years because of
harsher regulatory over- assessment. The case is months ended in Septem- in the U.S. market in em- environmental concerns
sight. ongoing. Metlife said this ber, MetLife Inc. posted ployee benefits and a ma- and because cheap natu-
The New York company has week it believes the inde- operating income of $4.11 jor provider of pension and ral gas prices prompted
been disputing its designa- pendent new U.S. life in- billion. retirement products. some utilities to switch
tion by federal regulators surance company would MetLife Executive Vice In after-hours trading, fuels. Coal carloads fell
as a “systemically impor- compete more effectively President Eric Steigerwalt MetLife Inc. shares jumped 32 percent in the fourth
tant” entity that’s deemed and allow MetLife to ben- was tapped to lead the almost 8 percent to quarter.q
“too big to fail.” efit from reduced capital new company, with the $45.21.q
