U.S. Stocks Close Mixed Ahead of Barrage of Earnings Reports

U.S. stock indexes closed mixed on Monday as investors prepared for a barrage of earnings reports later this week. The benchmark S&P 500 Index finished slightly lower. The utilities sector supported the index, but gains were limited by the weaker health care sector. The blue chip Dow Jones Industrial Average close lower. The average was helped by Home Depot stock, but hindered by tech giant IBM. The NASDAQ Composite managed to finish higher for a seventh-day.

In the cash market, the S&P 500 settled at 2459.14, down 0.13 or -0.01%. The Dow Jones Industrial Average closed at 21629.72, down 8.02 or -0.04% and the tech-based NASDAQ Composite finished the session at 6314.32, up 1.85 or +0.03%.

Volume was light as many of the major players stood on the sidelines ahead of the release of Netflex earnings after the bell. Other traders were just waiting to see how the first week of earnings pans out. Early Monday, asset manager BlackRock posted weak quarterly results, missing analyst estimates on both revenue and profit.

Later this week, quarterly results will be released by Goldman Sachs, Bank of America, Microsoft, Qualcomm and eBay to name a few.

According to S&P Capital IQ, overall earnings are expected to grow by 6.2 percent this quarter. This is coming off 15 percent gains in the first quarter.

Economic Reports

The New York Fed’s Empire State Manufacturing Index for July retreated from a two-year high on Monday, falling to a seasonally adjusted reading of 9.8 from 19.8 in June. Traders were looking for a reading of 15.

Crude Oil

Oil prices had a hard time following through to the upside on Monday after posting a solid 5 percent gain last week. Early in the session, U.S. West Texas Intermediate and internationally-favored Brent crude oil was underpinned by the idea that the pace of growth of U.S. rig additions was slowing. However, these gains didn’t last as sellers took control on renewed concerns over the OPEC-led plan to trim production, slash supply and stabilize prices.

Traders were particularly worried about rising supplies from Nigeria and Libya as well as growth in U.S. shale production. A report showing refineries in China increased crude throughput in June to the second highest on record also provided support early in the session.

Gold

Comex gold futures finished higher on Monday after the U.S. Dollar fell to a multi-month low as traders continued to react to muted U.S. inflation and reduced chances of a Fed rate hike later this year. Gold buyers also took advantage of the mixed U.S. stock market. Increased demand for higher-risk assets like stocks tend to put a lid on demand for lower-yielding assets like gold.