Spokesman of the Saudi-led military coalition Colonel Turki al-Maliki told reporters the weapons used in the attacks were Iranian-made
Spokesman of the Saudi-led military coalition Colonel Turki al-Maliki told reporters the weapons used in the attacks were Iranian-made AFP / Fayez Nureldine

Stocks opened lower on worries over oil prices as a result of drone strike on Saudi oil facilities that cut the world’s supply by 5% and an autoworkers strike against General Motors.

In midday trading, the Dow Jones Industrial Average gave up more than 150 points or 0.58%, the S&P 500 was off 0.45% and the Nasdaq Composite 0.44%.

Airline stocks were dragging the market lower. United Airlines (UAL) was off 0.92%, American Airlines (AAL) slid 4.41% and Delta Airlines (DAL) dropped 2.98%.

A drone strike against a Saudi oil facility raised the specter of further Middle East destabilization, sendubg oil prices soaring. Crude oil futures were up 11.39% and Brent futures jumped 11.89%. The Saudis said half of the lost output likely would be restored Monday and President Trump OKd the release of U.S. reserves to keep U.S. supplies stable.

Though Houthi rebels claimed responsibility for the drone strike, U.S. Secretary of State Mike Pompeo blamed it on Iran and said the United States was poised to retaliate. Tehran denied it was responsible.

In other news, GM workers staged their first strike in a dozen years as negotiations on a pattern contract for the industry stalled. The current agreement expired at 12:01 a.m. Sunday. The United Autoworkers is demanding greater compensation for the sacrifices members have made in recent years. GM offered $7 billion in investments in eight domestic plants and more than 5,400 new jobs. The UAW is seeking wages of nearly $30 an hour for entry-level employees within three to four years, which could cost GM $50 million.

OxyContin-maker Purdue Pharma filed for bankruptcy protection during the weekend following a tentative agreement to settle lawsuits filed by attorneys general and more than 2,000 cities and counties. The agreement called for Purdue Pharma to be reorganized into a trust that will help fight the opioid crisis.

On international markets, Asian stocks were mixed at the close with Hong Kong’s Heng Seng dropping 0.83%, Japan’s Nikkei 225 gaining 1.05% and China’s Shanghai composite was flat, off 0.02%. Australia’s S&P/ASX gained 0.06%.

In Europe, London’s FTSE closed off 0.28%, the German DAX dropped 0.56% and the French CAC 40 lost 0.71%. The British pound was off 0.65% against the dollar while the euro was off 0.58%. The U.S. dollar index was up 0.94%.

Gold and silver futures were higher.

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