Wall St: US shares drop on oil price slide

Earnings of S&P 500 companies are expected to fall 3.7 percent in the second quarter, compared with a 5-percent decline expected at the start of the earnings season, according to Thomson Reuters (Dusseldorf: TOC.DU – news) data.

The S&P and the Dow are just 0.6 percent shy of their intraday record highs.

North American stock markets pulled back in late morning trading ahead of a busy week of economic news including the latest meeting of the U.S. Federal Reserve.

Yahoo, which is not on the blue chip index, dropped almost 3 per cent after agreeing to sell its core business to Verizon Communications for more than $6 billion.

The S&P 500 index showed 24 new 52-week highs and no new lows, while the Nasdaq recorded 61 new highs and 10 new lows. The Dow Jones Industrial Average lost 26 points, or 0.1%, to 18,543, the S&P 500 index fell 2 points, or 0.1% at 2,172, while the Nasdaq Composite Index lost 3 points, or 0.1%, to 5,097. Verizon’s shares rose 0.3 percent. Recent economic data from the USA has been more positive than previously expected, but most market participants still say the central bank is unlikely to increase borrowing costs before December.

Wall Street marked its fourth-straight week of gains and the S&P 500 notched a new closing high on Friday, helped by telecom stocks and strong economic data.

The Nikkei Stock Average and the Shanghai Composite Index were little changed Monday.

Policymakers from the Group of 20 countries agreed at the weekend to work to support global growth and better share the benefits of trade, in a meeting dominated by the impact of Britain’s exit from Europe and fears of rising protectionism.

Markets are in “kind of a purgatory, somewhere in the middle”, said David Vickers, senior portfolio manager at Russell Investments. “We think we’ve largely bottomed in yields but we don’t think we are about to go on the uptrack. We are here to stay for a while”. The U.K.’s FTSE 100 was roughly flat.