Dow Jones was Down 300 Points on Tuesday as Exxon and Energy Shares Plunge

By Staff Writer

Feb 02, 2016 10:42 PM EST

Stock of oil companies plunged as crude oil continued its relentless slide. Dow Jones fell 300 points, while S&P 500 and Nasdaq also tumbled.

On Tuesday stocks fell sharply after crude oil severe plunge continues to under $30 per barrel. In futures market, West Texas Intermediate crude was down 5.5%, to $29.88 a barrel. This plunge give a pressure to Exxon Mobil (XOM) and Chevron (CVX), which was down 2.2% and 4.8% respectively.

As a result of pressure from oil companies' stock, Dow Jones Industrial Average was down 300 points or 1.8% at 16,154. Other indexes also feel the pressure, as S&P 500 was pressured at 1.9% and Nasdaq tumble 2.2%.

Two top analysts noted a similar pattern of oil price plunge and stock market fell. Stumble of oil price was dragging down the oil companies share, and as a result also sink the stock market. Chief investment strategist at R.W. Baird, Bruce Bittles noted in a report as quoted by USA Today, "Since the start of the year, there has been a 97% correlation between oil and equity prices."

While another analyst, a chief global strategist at JPMorgan Funds, David Kelly told CNBC, "The oil rally, which occurred around those rumors (about an output cut), has reversed and dragged down the stock market and long-term interest rates."

Beside Exxon Mobil and Chevron, other energy sector was not far better. All energy companies fell, including PetroChina (PTR), Royal Dutch Shell (RDS.A), Total (TOT) and Schlumberger (SLB). Resulting a 2.8% slide of the Energy Select Sector SPDR ETF (XLE).

Following drop on Tuesday, all three major indexes experienced a slow start in 2016 and back in the correction territory. That means they are off more than 10% from record closes in 2015. Since the beginning on this year, Dow Jones is down 7.3%, while S&P 500 is off 6.9% and Nasdaq is dropped 9.8%

Meanwhile, Internet company Alphabet (GOOGL) jumped more than 2%, after reporting its 13.5% profit surge in 2015 in its entire business, include its search engine and multimedia. Its annual revenue in fourth quarter rose 18% adding an annual profit to reach $75.54 billion.

Jim Cramer, co-founder of TheStreet, Inc wrote as cited by The Street, "Last night's call on Alphabet gave every growth stock manager goose bumps. That's because it had accelerated revenue growth, or ARG, as I like to call it, at the same time that it had ratcheted back expenses."

As oil price continues its relentless slide, stocks dipped to its session lows on Tuesday. Shares of oil and energy companies plunged following oil price. As a result, Dow Jones, S&P 500 and Nasdaq was also down in the correction territory.

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