Stocks were mostly lower Tuesday as Wall Street came out of a long holiday weekend and oil prices turned lower following a surge after a breakdown of talks among the world’s largest oil producers.
The Dow Jones Industrial Average fell 222 points, or 0.64%, to 34,563, the S&P 500 declined 0.32% and the Nasdaq was up 0.19%.
U.S. oil prices rose to a six-year high earlier Tuesday after OPEC and its allies broke off talks Monday over a production increase. The United Arab Emirates refused to agree to a Saudi-backed deal to boost output, according to reports.
West Texas Intermediate crude, the U.S. benchmark, came off earlier highs turned lower Tuesday, falling 0.51% to $74.78 a barrel. U.S. crude hit a high earlier of $76.98 a barrel.
Investors are concerned the oil impasse could escalate into a price war that could stall a global economic recovery just as demand rebounds from the coronavirus pandemic.
The White House said it was monitoring the situation.
“The United States is closely monitoring the OPEC+ negotiations and their impact on the global economic recovery from the COVID-19 pandemic,” a White House spokesperson said in a statement.
“We are not a party to these talks, but administration officials have been engaged with relevant capitals to urge a compromise solution that will allow proposed production increases to move forward,” the statement added.
In the U.S., all three major stock market indexes closed at records Friday after the economy added more jobs than expected in June and hourly wage increases were below forecasts, giving rise to the belief the Federal Reserve won’t be hiking interest rates anytime soon. The Dow, S&P 500 and Nasdaq also rose for a second straight week.
However, a jump in oil prices would add to recent inflationary pressures and fears the Fed could begin pulling back on support sooner rather than later.
Minutes from the Federal Reserve’s meeting on June 15-16 will be released on Wednesday. Investors will be paying close attention to the minutes, hoping they shed some light on the central bank’s recent hawkish tilt that caught markets by surprise.
U.S.-listed shares of Didi Global fell sharply Tuesday after the Cyberspace Administration of China late last week began a cybersecurity review into Didi and blocked the company’s app from accepting new users, and then on Sunday ordered the company’s app to be removed from stores.
Bitcoin prices steadied Tuesday after a recovery over the weekend and a slump on Monday.
Bitcoin was at $34,477, up 2.49%. The world’s largest cryptocurrency has risen more than 17% in 2021 but has dropped nearly 50% from its all-time high of $64,829, according to CoinDesk.
This article was originally published by TheStreet.