Energy shares have been on a downward spiral for quite some time and once again they became the cause of the U.S stock market plummeting. The reason for energy stocks falling was the new sanctions issued against Russia by the Treasury Department as they had been fighting a civil war in Ukraine which is against the humanistic code they follow. Russian banks’ access has been limited to U.S debt and equity market only hence the oil and defense sector has suffered being cut off from a huge buyer market.

The standard and poor energy index .SPNY fell about 1.5 percent, continuing the downward slide that started weeks ago being amongst the day’s worst performing sector. The plummet let the group down by 3.7 percent with US crude oil prices being reduced by 0.6%. Other groups suffered a similar let down with S&P 500 down by 1.2% and the Dow index dropping 0.9 percent and the NASDAQ was dropping around 0.3%.

China Green Agriculture, Inc (NYSE:CGA) was the highest gainer, on New York stock exchange rising about 35 percent while the lowest was North Atlantic Drilling Ltd. (NYSE:NADL), down by 7.23 percent. The investors and shareholders are blaming this on the president of Russia- Vladimir Putin, for intervening in the war going on in Ukraine. He’s also alleged to be helping the rebels with arms and ammunition, soldiers and finance. He denies the allegations ofcourse but that didn’t stop the US from taking action against Russia.

Investors say that the energy and oil sectors are the hottest on the market but because of the sanction against Russia, there has been a big decline which is affecting a big chunk of investors. Every investor is pulling out and this is making the decline gain even more momentum. Shareholders are in a miserable situation as they can’t find any buyers for their shares and they can’t even stay as sitting ducks. Nobody is willing to buy the shares after this downward spiral which shows no sign of gaining anytime soon.

Sprint Corporation (NYSE:S) has gained a few points on the New York Stock Exchange, gaining around 7 percent. In NASDAQ, Apple Inc (NASDAQ:AAPL) was the only company performing well, going up by 0.2 percent courtesy new unveilings and smart deals. But overall the rest of the market has been overall mellow. The S&P 500 recorded 52 highs and 4 new lows; NASDAQ got 45 highs and 18 new lows. For NASDAQ which is a big market to record so many lows is indeed a concern for the whole market with the corporations included.

 

It would be better for governments to not withhold trade relations just on the basis of political stress among two countries as it can be disastrous for the stock market. They should keep politics out of the economy because a recession is the last thing this world needs right now as it just might prove to be too much of a strain to take.

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