Stocks Tumbled on Oil Woes

U.S. stocks dropped on Tuesday after a disappointing spending forecast from Exxon Mobil (XOM) and another steep drop in oil prices. The Dow Jones industrial average fell 295.64 points, or 1.80%, to 16,153.54. The S&P 500 lost 36.35 points, or 1.87%, to 1,903.053. The Nasdaq Composite dropped 103.42 points, or 2.24%, to 4,516.95.

Exxon Mobil Corp., which has spent about $210 billion over the last decade buying back its own stock, is bowing to the reality that crude’s sharp downturn is hurting its bottom line. It surprised investors on Tuesday by dramatically ratcheting back share repurchases. Exxon reported its smallest quarterly profit in more than a decade and said it will cut 2016 spending by one-quarter and suspend share repurchases.

WTI oil prices slid again Tuesday to settle under $30 a barrel, as expectations for cuts in crude output from major producers faded and the market readied for weekly data that are expected to show a hefty increase in U.S. supplies. March West Texas Intermediate crude fell $1.74, or 5.5%, to settle at $29.88 on the New York Mercantile Exchange.

United Parcel Service Inc. on Tuesday reported better-than-expected earnings in the most recent quarter as growth in international package delivery drove profitability. For the quarter ended Dec. 31, UPS posted earnings of $1.33 billion, or $1.48 a share, up from $453 million, or 49 cents a share, a year earlier.

Yahoo Inc. YHOO is expected to report fourth-quarter earnings after the market close on Tuesday. The company’s revenue is forecast to come in just below $1 billion, which would mark the first time it has fallen back into the millions since calendar-year 2004. The company is also expected to announce a series of layoffs as it works to cut costs and restructure the company, as well as a discussion of “strategic alternatives.”