US stocks slip as energy companies and drugmakers slide

NEW YORK (AP) — U.S. stocks dipped Tuesday morning as energy and materials companies fell along with the price of oil and precious metals. Drug companies were pummeled again on investor concerns that it will become more difficult for the companies to hike prices. The Bank of Japan cut its economic...

 
              Trader Joseph Lawler, left, works on the floor of the New York Stock Exchange, Tuesday, March 15, 2016. U.S. stocks tumbled in the first minutes of trading as falling commodity prices again pulled energy and materials companies lower. (AP Photo/Richard Drew)

NEW YORK (AP) — U.S. stocks dipped Tuesday morning as energy and materials companies fell along with the price of oil and precious metals. Drug companies were pummeled again on investor concerns that it will become more difficult for the companies to hike prices. The Bank of Japan cut its economic forecasts, which hurt stocks overseas.

KEEPING SCORE: The Dow Jones industrial average declined 31 points, or 0.2 percent, to 17,198 as of 10:55 a.m. Eastern time. The Standard & Poor's 500 index lost 12 points, or 0.6 percent, to 2,008. The Nasdaq composite index fell 30 points, or 0.6 percent, to 4,719.

COMMODITIES CRUNCHED: Oil prices fell sharply for the second day in a row. Benchmark U.S. crude shed 76 cents, or 2 percent, to $36.42 a barrel in New York. Brent crude, used to price international oils, lost 58 cents, or 1.5 percent, to $38.94 per barrel in London.

The price of gold fell about 1 percent to $1,233.60 an ounce and silver sank 1.6 percent to $15.27 an ounce.

Mining and energy company Freeport-McMoRan fell 81 cents, or 8.1 percent, to $9.16. Chevron gave up $1.23, or 1.3 percent, to $93.03, and Murphy Oil gave up 67 cents, or 2.8 percent, to $23.07.

VALEANT TUMBLES: Valeant Pharmaceuticals' preliminary fourth-quarter profit disappointed investors and the drugmaker cut its estimates for 2016. It's already under scrutiny from Congress over drug prices and it is being investigated by the Securities and Exchange Commission. The stock plunged $26.76, or 38.8 percent, to $42.27, its lowest price since mid-2012.

Acquiring older drugs and raising their prices is a key part of Valeant's business, and it's one of a group of stocks that have tumbled as Congress has questioned that practice. On Tuesday Mallinckrodt lost $5.55, or 8 percent, to $64.07 and Endo International fell $2.15, or 5.1 percent, to $39.93. Valeant stock has fallen more than 80 percent over the last six months, while Endo is down about 50 percent. Mallincrkodt has dropped about 50 percent since early August.

Other drugmakers that slumped included multiple sclerosis medication maker Biogen, which gave up $6.82, or 2.6 percent, to $250.95, and eye drug maker Regeneron, which shed $8.58, or 2.3 percent, to $364.39.

POWER UP: Utility stocks were the biggest gainers. One of the best-performing sectors of the market this year, utilities are generally seen as relatively safe investments and do well during times of market turmoil. American Water Works rose 77 cents, or 1.1 percent, to $68.77 and Entergy added 62 cents to $7.16.

LILLY LOWER: Drugmaker Eli Lilly fell on concerns surrounding the potential approval of a drug designed to treat dementia caused by Alzheimer's disease. The company said Tuesday it is changing the goal of a late-stage trial, and investors worried the change makes it less likely regulators will approve the drug. The stock shed $3.36, or 4.5 percent, to $70.55.

TIGHT-FISTED SHOPPERS: The Commerce Department said retail sales slipped in February, as consumers spent less and remain cautious about the state of the economy in spite of steady hiring. Sales fell 0.1 percent compared with a year earlier, though they improved if gas and auto sales are left out. The government also said sales fell in January, changing an earlier estimate that spending increased.

Spending by consumers makes up 70 percent of the U.S. economy.

WONDERWALL: Outerwall, the company behind Coinstar coin-counting kiosks and Redbox disc-rental kiosks, indicated it may look to sell itself by saying it will seek "strategic and financial alternatives" to boost value for its shareholders. It also doubled its quarterly dividend. The stock added $2.36, or 6.9 percent, to $36.75.

WATCHING THE FED: The Federal Reserve's Federal Open Market Committee meets Tuesday and Wednesday. Investors don't expect the Fed to raise interest rates, but they will pore over the Fed's views on the economy and look for hints about its plans. In December the Fed raised interest rates for the first time in almost a decade, but it left them unchanged in January amid growing market turmoil.

OVERSEAS: The Bank of Japan left its monetary policy unchanged Tuesday but downgraded its assessment of conditions in the world's third-largest economy, citing risks from weaker growth in China and other emerging economies and volatility in financial markets, among other factors. Tokyo's Nikkei 225 lost 0.7 percent and Hong Kong's Hang Seng declined 0.7 percent Seoul's Kospi was off 0.1 percent and the Shanghai Composite Index gained 0.2 percent.

France's CAC-40 has lost 0.8 percent and Germany's DAX shed 0.5 percent. Britain's FTSE 100 is down 0.4 percent.

BONDS, CURRENCY: Bond prices rose and the yield on the 10-year U.S. Treasury note dipped to 1.94 percent from 1.96 percent. The euro edged up to $1.1104 from $1.1097 and the dollar slipped to 113.04 yen from 113.80 yen. The British pound fell to $1.4169 amid renewed jitters about the June popular vote on whether to remain in the 28-country European Union. The pound fell to a seven-year low last month.

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP. His work can be found at http://bigstory.ap.org/journalist/marley-jay

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