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Overnight Markets: Wall Street down ahead of earnings season
by Himanshu Singh on Jan 08, 2013 at 05:21
Wall Street declined on Monday as investors looked forward to the corporate earnings season on Wednesday.
The Dow Jones industrial average dropped 51 points, or 0.38%, to 13,384. The Standard & Poor's 500 Index fell five points, or 0.31%, to 1,462. The Nasdaq Composite Index lost three points, or 0.09%, to 3,099.
Investors are expecting earnings to be only slightly better than the third-quarter's lacklustre results, and analysts' current estimates are down sharply from where they were in October. According to Thomson Reuters data, fourth-quarter earnings growth is expected to come in at 2.8%.
Financial sector suffered after a group of major US banks agreed to pay a total of $8.5 billion to end a government inquiry into faulty mortgage foreclosures.
In a separate case, Bank of America also announced roughly $11.6 billion of settlements with mortgage finance company Fannie Mae and a $1.8 billion sale of collection rights on home loans.
Bank of America shares lost 0.2% while Nationstar Mortgage Holdings jumped 16.8%. Citigroup shares were up 0.09%, and Wells Fargo shares fell 0.5%.
Other sectors also declined, most notably energy and utilities. Aluminum company Alcoa begins the reporting season by announcing its results after Tuesday's market close. Alcoa shares fell 1.7%.
Shares of U.S. jet maker Boeing Co dropped 2% after a Boeing 787 Dreamliner aircraft with no passengers on board caught fire at Boston's Logan International Airport on Monday morning.
Amazon.com shares hit their highest price ever at $269.22 after Morgan Stanley raised is rating on the stock. Shares were up 3.6%.
Video-streaming service Netflix Inc shares gained 3.4% after it said it will carry previous seasons of some popular shows produced by Time Warner's Warner Bros Television.
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