U.S. stocks followed global markets down Tuesday after a lukewarm respite a day earlier when a tech stock rally helped offset losses in energy shares. Traders continued to use falling oil prices as a weather vane of global economic health, fueling one of the most volatile starts to a year on record with the S&P index down more than 6 percent since the first trading day in January.
“While we believe the worst is over, we think volatility will continue,” Peter Cardillo, chief market economist for First Standard Financial, said in a note on Tuesday.
The Dow (INDEXDJX:.DJI) dropped 267 points by midday Tuesday, or 1.62 percent, to 16,182.06. The broader S&P 500 index (INDEXSP:.INX) lost 31.79 points, or 1.64 percent, to 1,940.24. The Nasdaq composite (INDEXNASDAQ:.IXIC) shed 78.49 points, or 1.7 percent, to 4,541.94. The Dow has lost about 7 percent since the start of the year, while the Nasdaq has about 9 percent.
All 10 S&P 500 sectors were down Tuesday, led by steep drops in energy and financials. All but one of the Dow 30 components were down by midday Tuesday. The only exception: science and technology company E I Du Pont De Nemours And Co (NYSE:DD), more commonly known as DuPont, as investors bought on a recent dip and looked to positive earnings from Dow Chemical Co. (NYSE:DOW), with which DuPont is seeking to merge. Dow said in its fourth-quarter and full-year 2105 earnings reports that low oil prices have helped its plastics division.