Investing.com -- U.S. stocks staged a late rally on Thursday amid reports that OPEC members could consider slashing record high crude production as a way of rescuing plunging oil prices, but were unable to erase earlier losses triggered by continuing weakness in the financial sector.
The major indices cut sharp losses in the final hour of trading, as reports of a potential production cut by the world's largest oil cartel surfaced from Dow Jones minutes after the close of oil markets on Thursday afternoon. Earlier, U.S. crude futures closed under $26.20 a barrel to hit their lowest closing level since May, 2003. Global oil prices have crashed more than 70% from their peak of $115 a barrel 20 months ago, amid a glut of oversupply on global markets.
The Dow Jones Industrial Average lost 257.78 or 1.62% to 15,656.96, while the NASDAQ Composite index inched down 16.75 or 0.39% to 4,266.84, as investors digested a flurry of market-moving comments throughout the day. At session lows, the Dow fell more than 400 points. The S&P 500, meanwhile, fell 23.03 or 1.24% to 1,828.83, as nine of 10 sectors closed in the red. Stocks in the Financials, Basic Materials and Industrials sectors lagged, each falling by more than 1.75%. Stocks in the Consumer Services industry led.
The Dow and S&P 500 both fell for the fifth straight day, hovering near two-year lows for most of the session. The S&P 500 fell below a key technical level at 1,810 late in the trading day, before rebounding slightly just before the close.
In the morning session, U.S. stocks opened broadly lower after a host of major banking stocks fell precipitously, extending heavy losses from earlier in the week. It was triggered by an unexpected move from Sweden's Central Bank to lower its repo rate deeper into negative territory, exacerbating fears that other central banks in the euro zone could follow suit. Separately, Federal Reserve chair Janet Yellen told Congress on Thursday morning that while the Fed has not taken negative interest rates off the table, it is unlikely that the U.S. central bank will cut short-term rates in the near-term future.
The top performer on the Dow was Cisco Systems Inc (O:CSCO), which surged 2.37 or 10.53% to 24.88, one day after topping analysts' estimates with its quarterly earnings. The California-based networking equipment company also announced a dividend increase and a share buyback program on Wednesday evening, underscoring its confidence of its near-term growth potential.
The worst performer was Boeing Company (N:BA), which plunged 7.86 or 6.75% to 108.50 after reports surfaced that the Securities and Exchange Commission (SEC) has launched a probe into the aircraft manufacturer's accounting practices. The investigation is focused on whether Boeing (N:BA) properly accounted for the costs related to sales of its 787 Dreamliner and 747 jumbo aircraft, multiple outlets reported.
The biggest gainer on the NASDAQ was TripAdvisor Inc (O:TRIP), which surged 7.21 or 13.27% to 61.56, after the world's largest travel website beat analysts' quarterly earnings expectations for the first time since 2013. The worst performer was Mylan Inc (O:MYL), which plummeted 8.99 or 17.79% to 41.55. Shares in Mylan fell sharply after the pharmaceutical giant announced a deal to acquire Swedish drug company Meda in a $7.2 billion deal.
TripAdvisor was also the top performer on the S&P 500, just above CenturyLink Inc (N:CTL), which added 2.88 or 11.71 to 27.47. Mylan (O:MYL) also finished as the worst performer on the S&P, just below International Flavors & Fragrances (N:IFF), which plunged 14.84 or 12.87% to 100.49.
On the New York Stock Exchange, declining issues outnumbered advancing ones by a 2,506-574 margin.