Wall Street Slips, NY Asks SEC to Force Climate Vote on Exxon Proxy
U.S. stocks slipped over 1% on Wednesday, weighed down by lower oil prices and struggling financial stocks. New York’s comptroller has asked the United States Securities and Exchange Commission to force ExxonMobil to add a climate change resolution in its yearly shareholder proxy. Exxon (XOM) tumbled 1.2%, and oil slipped 3% on the news.
All of the S&P’s 10 major sectors were down, with financials leading the decliners, falling 1.8%. Financial stocks have been the worst performers in 2016.
JP Morgan (JPM) lost 2.3%, dropping to $54.81 after forecasting a double-digit decline in its investment banking revenue and boosting its reserves for energy loan losses. The news impacted other lenders, many of which are preparing for defaults from the oil and gas sector.
A 3% decline in U.S. crude was partly driven by new data that showed stockpiles increased. Along with Exxon, shares for Chevron (CVX) tumbled 1.3%.
Oil prices and stocks have been largely tied together this year. The S&P 500 is down 6% for 2016, and the Nasdaq composite has lost over 10% thus far.
In Tuesday’s morning trading, the Nasdaq was down 59.89 points (1.33%) to 4,443.69. The S&P 500 fell 23.89 points (1.24%) to 1,897.38, and the Dow Jones lost 208.8 points (1.27%) at 16,222.98.
Meanwhile, Reuters reports that the comptroller in New York state and four Exxon Mobile shareholders are pressing the SEC to force the oil company to include a climate change resolution in its yearly shareholder proxy.
The move comes at a time when a growing number of investors are becoming increasingly concerned that legislation designed to curb climate change will hinder Exxon’s profitability. Exxon is also fighting an inquiry from New York’s attorney general as to whether it misled shareholders and the public on the risks of climate change.
Last month, Exxon told the Securities Exchange Commission that it planned to block a vote on the resolution at its yearly meeting this May. The oil producer claimed that the resolution was too vague and called for metrics that were difficult to accurately quantify.
Both Exxon and the SEC have yet to comment on the matter.
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