Stocks were moving mostly lower in early trading Monday as investors looked ahead to the Fed’s meeting in Jackson Hole, Wyoming, for clues on timing for possible interest rate hikes. A drop in oil prices pulled energy companies lower, along with the broader market.
KEEPING SCORE: The Dow Jones industrial average lost 67 points, or 0.4 percent, to 18,487 as of 9:50 a.m. Eastern. The Standard & Poor’s 500 index lost six points, or 0.3 percent, to 2,178 and the Nasdaq composite lost four points, or 0.1 percent, to 5,234.
ENERGY WEAKNESS: Oil prices fell sharply in early trading. U.S. benchmark crude lost $1.39 to $47.71 a barrel and Brent crude, used to price oil internationally, declined $1.47 to $49.41 a barrel. The drop in energy prices dragged down energy stocks, which lost 1.2 percent, far more than the rest of the market.
FED WATCH: Investors were looking ahead to a speech by Fed chair Janet Yellen at an annual summer gathering in Jackson Hole for indications of how policymakers view the outlook for economic growth and interest rates. Analysts expect Yellen to express caution but support the impression the U.S. central bank is on track to raise rates as early as this year.
While investors do not expect the central bank to raise interest rates at its September meeting, there’s always the possibility and the increasing likelihood of a rate increase once the presidential election is finished.
DRUG DEAL: Cancer drug maker Medivation jumped $13.34, or 20 percent, to $80.49 after pharmaceutical giant Pfizer announced it would buy the company for $14 billion, or $81.50 a share. Pfizer is buying Medivation for its heavily used prostate cancer drug Xtandi, which generates roughly $2 billion in sales a year.
BONDS, CURRENCIES: U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 1.56 percent from 1.58 percent late Friday. The dollar rose to 100.43 yen from 100.24 yen. The euro fell to $1.1312 from $1.1324.
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