Investing.com -- U.S. stocks retreated from near six-week highs reached in the previous session, as a pair of prominent energy ministers rattled markets with bearish comments on global supply and JPMorgan Chase & Co (N:JPM) announced downbeat forecasts for the first quarter, due in part to its exposure to the oil and gas industry.
Crude futures tumbled more than 4% on Tuesday, after Saudi Arabia oil minister Ali al-Naimi reiterated that his nation remains committed to freezing its production at January levels, but will not approve any output cuts. Last week, Saudi Arabia, Russia and two other OPEC members agreed in principle to cap production from last month's totals in a deal which could represent the first accord between OPEC and Non-OPEC producers in 15 years. Al-Naimi's comments came hours after Iran oil minister Bijan Zanganeh called the deal "ridiculous," for imposing "unrealistic demands," on his nation.
The deal is contingent on receiving approval from Iran, which has been reluctant to freeze output, weeks after a wide range of economic sanctions were lifted against the Persian Gulf state.
The Dow Jones Industrial Average lost 188.88 or 1.14% to 16,431.78, while the NASDAQ Composite index fell 67.03 or 1.47% to 4,503.58, as tech and pharmaceutical stocks weighed. The S&P 500 Composite index, meanwhile, dropped 24.23 or 1.25% to 1,921.27, as nine of 10 sectors closed in the red. Stocks in the Energy and Basic Materials sectors lagged, each falling by more than 2.5%. Stocks in the Utilities industry led.
At JP Morgan's Investor Day on Tuesday, Corporate & investment Bank CEO Daniel Pinto warned that its investment banking fees have tumbled 25% in the first quarter on an annual basis, while its market revenue has slid another 20%. At the same time, the world's largest bank disclosed that it will reserve an additional $600 million to cover energy and commodity loans in the first quarter, increasing its total to $1.6 billion for the period. If oil prices fall to $25 a barrel for the next 18 months, the bank will be forced to double its reserves by another $1.5 billion.
The top performer on the Dow was Home Depot Inc (N:HD), which added 1.73 or 1.41% to 124.58. Earlier on Tuesday, Home Depot raised its dividend by 17% after its sales for the fourth quarter surged 9.5% amid continued recovery in the U.S. housing market. JP Morgan finished as the worst performer, after losing 2.47 or 4.22% to 56.10.
The biggest gainer on the NASDAQ was Mondelez International Inc (O:MDLZ), which added 0.41 or 1.03% to 40.11. Mondelez finished just above SRCL, which rose 1.09 or 0.98% to 112.33, after analysts at Jeffries reiterated its Buy rating on the Illinois-based medical waste disposal company. The worst performer was Western Digital Corporation (O:WDC) after Unisplendour Corp., a Chinese investment firm, terminated its $3.7 billion investment into the disk-drive manufacturer, complicating its attempt to merge with SanDisk Corporation (O:SNDK). Shares in Western Digital (O:WDC) fell 3.35 or 7.27% to 42.75.
The top performer on the S&P 500 was Frontier Communications Corporation (O:FTR) after the Connecticut-based telecommunications company topped analysts' expectations with its fourth quarter earnings. During the period, Frontier received approval from the FCC for its proposed acquisition of Verizon Communications Inc's (N:VZ) local wire-lines operations in Florida, Texas and California. Shares in Frontier Communications (O:FTR) gained 0.53 or 11.64% to 5.04. The worst performer was Cabot Oil & Gas Corporation (N:COG), which slumped 2.05 or 9.52% to 19.49. A host of energy stocks were among the worst performers of the session, as Southwestern Energy Company (N:SWN), Chesapeake Energy Corporation (N:CHK), CONSOL Energy Inc (N:CNX) and Range Resources Corporation (N:RRC) also fell more than 6% on the day.
On the New York Stock Exchange, declining issues outnumbered advancing ones by a 2,059-989 margin.