Wall Street loses gains as health stocks, oil prices slide
Reuters
Published Jan 11, 2016 11:41AM ET
Wall Street loses gains as health stocks, oil prices slide
By Abhiram Nandakumar
(Reuters) - Wall Street gave up early gains and were lower late on Monday morning, dragged down by health stocks and as crude prices slid further ahead of the start of the corporate earnings season.
The S&P materials and energy sectors were both off more than 1 percent, under pressure as oil prices fell for the sixth day in a row. U.S. crude fell to $31.93, its lowest since 2003.
The health sector fell the most, declining 1.38 percent, dragged down by Celgene (O:CELG) and McKesson (N:MCK).
U.S. stocks had opened higher, coming off their worst-ever start to a year on mounting investor concerns about declining oil prices and a China-led slowdown in global growth.
Even strong December U.S. nonfarm payrolls data failed to boost investor optimism.
"None of us know what the future is, but given this moment, where we've gotten very conflicting data, it makes investors nervous," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
"I think the final coup de grâce is the Federal Reserve and its tightening phase has made them even more nervous."
At 11:04 a.m. ET (1604 GMT), the Dow Jones industrial average was down 25.99 points, or 0.16 percent, at 16,320.46.
The S&P 500 was down 6.14 points, or 0.32 percent, at 1,915.89 and the Nasdaq Composite index was down 24.20 points, or 0.52 percent, at 4,619.43.
The utilities sector's 0.7 percent gain led the three advancing S&P sectors.
Celgene fell 7.2 percent to $101.10 and McKesson dropped 9.5 percent to $165.10 after both companies gave disappointing profit forecasts.
Alcoa is scheduled to report fourth-quarter results after the close, unofficially starting the earnings season. The stock gave up early gains and was down 0.7 percent at $8.01.
Energy and materials companies are expected to be main drivers behind U.S. corporate earnings moving into a recession - two quarters of falling profits - in the quarter.
Overall, fourth-quarter corporate earnings are expected to decline 4.2 percent, according to Thomson Reuters I/B/E/S.
Apple was up 0.8 percent at $97.70 on reports that its music streaming service hit the 10 million-subscriber mark in six months. The stock gave the biggest boost to the S&P 500 and Nasdaq.
Macy's was up 4.3 percent at $37.45 after Starboard Value urged the company to enter into joint ventures for its stores.
Under Armour was down 8 percent to $69.01 after Morgan Stanley (N:MS) cut its rating and price target on the stock.
Declining issues outnumbered advancing ones on the NYSE by 1,855 to 1,041. On the Nasdaq, 1,648 issues fell and 965 rose.
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The S&P 500 index showed one new 52-week high and 81 new lows, while the Nasdaq recorded eight new highs and 283 lows.
Written By: Reuters
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