Stocks Finish Lower; Tesla Hits All-Time High; Oil Slips

Stocks ended lower Tuesday as investors weighed the risks of further escalation of tensions between the U.S. and Iran.
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  1. Stocks finished down Tuesday as investors weighed the risks of further escalation of tensions between the U.S. and Iran.
  2. Tesla rose to an all-time high after CEO Elon Musk officially launched the electric vehicle company's Model Y production at its Shanghai "gigafactory." 

  3. Kohl's is Real Money's Stock of the Day. Analysts at Jefferies cut their rating and price target on shares of the mall-focused retailer. 

Stocks ended lower Tuesday and crude oil prices retreated as investors weighed the risks of further escalation of tensions between the U.S. and Iran.

Global crude prices pulled back overnight as the rhetoric between the U.S. and Iran let up somewhat despite simmering resentment for the Jan. 3 killing of Iranian General Qassem Soleimani.

The Dow Jones Industrial Average was down 119 points, or 0.42%, to 28,583, the S&P 500 fell 0.28% and the Nasdaq was off 0.03%.

Merck (MRK) - Get Report, JPMorgan Chase (JPM) - Get Report, and Chevron (CVX) - Get Report led  the Dow's retreat.

Brent crude futures contracts for February delivery, the global benchmark, were falling 1.12% on Tuesday to $68.14 a barrel, while West Texas Intermediate crude contracts for the same month declined 1.11% to $62.57.

"The market has a bit of an identity problem in that it doesn’t know what it wants to be - one that dips to geopolitics, or rises to strong economic fundamentals," said Mike Loewengart, vice president of investment strategy at E*Trade. "In the meantime lack of news is translating into lack of moves and the market keeps going back to its home base.

"With major jobs news on deck and earnings season about to heat up, we could see this inject some excitement into the markets. As the trade war with China continues, we’re seeing the trade deficit shrink for the third straight month -- which could serve to bolster the next U.S. GDP read," Loewengart added.

Tesla (TSLA) - Get Report rose Tuesday to an all-time high after founder and CEO Elon Musk officially launched the electric vehicle company's Model Y production at its Shanghai "gigafactory."

Musk predicted the SUV would be more popular than its other vehicles in the world's largest car market.

Micron Technology (MU) - Get Report and Western Digital (WDC) - Get Report posted gains on Tuesday after Cowen upgraded both stocks to outperform from market perform, and also raised its one-year stock price targets for each.

Merck declined after the drugmaker said a late-stage trial of its blockbuster Keytruda cancer treatment failed to increase patient survival rates.

Merck said a phase 3 trial study involving patients with extensive stage small-cell lung cancer, a less-common form of the disease, indicated improvement in overall survival rates when Keytruda was combined with chemotherapy, but added the results weren't statistically significant.

Citigroup (C) - Get Report is making David Chubak its new head of U.S. retail banking, CNBC reported. Chubak has held largely strategic roles across Citigroup since he came from McKinsey in 2013. He will report directly to Anand Selva, head of the U.S. consumer banking division.

Kohl's (KSS) - Get Report was down slightly, but finished modestly higher after analysts at Jefferies cutting their rating and price target for the mall-focused retailer. 

The U.S. trade deficit fell 8.2% to $43.1 billion in November, the lowest level in three years. It's the third straight month the trade gap has declined.

Exports in November rose 0.7% from the prior month while imports decreased 1%, reflecting a drop in imports from China.

The Institute for Supply Management’s non-manufacturing index, which measures activity in the U.S. services sector, rose to 55 in December from 53.9 the prior month.