US stocks move lower as crude oil renews its slide

NEW YORK — U.S. stocks moved lower Wednesday, led by declines in energy stocks as the price of oil resumed its slide. Investors are also speculating the Federal Reserve will soon signal that it intends to raise interest rates next year should the economy continue to strengthen.

Oil dropped on reports that OPEC had slashed its estimate of how much crude it will need to produce next year due to rising supplies from other producers such as the U.S.

KEEPING SCORE: The Standard & Poor's 500 index fell 12 points, or 0.6 percent, to 2,047 as of 11:23 a.m. Eastern. The Dow Jones industrial average dropped 123 points, or 0.7 percent, to 17,678. The Nasdaq composite fell 18 points, or 0.4 percent, to 4,746.

ENERGY: Benchmark U.S. crude was down $2.76, or 4.4 percent, to $61 a barrel on the New York Mercantile Exchange. The price of oil has plunged more than 40 percent from a peak of $107 a barrel in June as traders speculate that the supply of oil being pumped by the world's biggest producers will exceed demand.

FLYING HIGH: Airline stocks were among the gainers as the price of oil plunged. Southwest Airlines rose $1.13, or 2.5 percent, to $41.76, taking its gain this year to 125 percent. Delta Air Lines also advanced, rising 55 cents, or 1.1 percent, to $46.81.

LANGUAGE CHANGE: While a slump in stocks this week is being led by a decline in the energy sector, investors are also speculating that the Federal Reserve will signal that it is nearing its first rate increase in more than eight years as the economy strengthens. Policy makers are scheduled to convene a two-day meeting on Dec. 16.

THE QUOTE: "The stronger employment data and economic data that we have gotten has only increased people's confidence that the Fed is going to be raising rates by the (middle) of next year," said Rob Eschweiler, global investment specialist in Houston.

EUROPE'S DAY: European stocks rebounded after a sell-off a day earlier on concerns that Greece might have to hold early general elections and that a left-wing opposition party would win. The Syriza party wants to cut what Greece owes in bailout money, which could potentially derail the country's recovery.

France's CAC-40 gained 0.2 percent to 4,271 and Germany's DAX was up 0.6 percent at 9,857. Britain's FTSE 100 fell 0.2 percent to 6,517.

BONDS AND CURRENCIES: Government bond prices were little changed. The yield on the benchmark U.S. Treasury note, which rises when prices fall, edged down to 2.20 percent from 2.21 percent on Tuesday.

The dollar fell to 118.54 yen from 119.40 late Tuesday. The euro rose to $1.2420 from $1.2385.

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Kurtenbach reported from Tokyo.

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