U.S. stocks were mixed on Monday morning as oil prices gave up earlier gains.Video provided by TheStreet Newslook
The U.S. stock market, currently riding a two-week losing streak amid signs of fading momentum after a big rally off the market lows back in February, kicked off the new week with mixed results and little signs of breaking out to the upside.
Wall Street, which is closely watching oil prices amid supply shortfalls due to the wildfires in Western Canada that has taken an estimated 1 million barrels per day out of production and a personnel change at the top of Saudi Arabia’s oil ministry, appears to be in no rush to load up on stocks.
Stocks ended mixed in quiet trading with the Dow Jones industrial average down 34 points, or 0.2%, to 17,706 and the broader Standard & Poor’s 500 up 0.1%. The technology-dominated Nasdaq composite gained 0.3%.
Heading into the new week, Wall Street was pricing in all sorts of new information and unknowns, ranging from Friday’s weaker-than-expected reading on April job creation to uncertainty related to the presidential election to the ongoing turbulence in the oil patch.
The price of U.S.-produced crude, which was up more than 2% earlier in the session and as high as $45.49 per barrel, turned lower in volatile trade, settled down off $1.29, or 2.9%, to $43.37. Perhaps, investors view the current production cuts due to the Canadian wildfires to be temporary or short-term in nature.
Professional stock investors entered the new week warning of a stock market that has clearly entered a so-called “consolidation” phase after a big rally carried the Dow and S&P 500 within a percentage point or two of new record highs.
U.S. stocks may also be weighed down by a rebound in the value of the U.S. dollar vs. a basket of foreign currencies. The Wall Street Journal dollar index is up 0.5% Monday, and on track for its fifth straight day of gains.
While there’s no economic data releases of import set for release Monday, Wall Street will watch the tail-end of the first-quarter earnings season, which has been weak, but not as bad as feared. With 438 of the 500 S&P 500 companies having already reported, earnings are seen contracting 5.1%, which is far better than the nearly 8% slide forecast at the start of the reporting season, according to earnings-tracking Thomson Reuters.
Nineteen companies in the S&P 500 are on tap to report results this week, including drug company Allergan, Walt Disney and game maker Electronic Arts on Tuesday, and retailers Macy’s, Kohl’s and Nordstrom later in the week.