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Overnight Markets: US stocks retreat ahead of earnings season

by Himanshu Singh on Jul 08, 2014 at 04:18

Overnight Markets: US stocks retreat ahead of earnings season

Wall Street declined on Monday, led by a plunge among small companies, as investors hesitated to make big bets before the start of earnings season.

The Dow Jones industrial average fell 44 points or 0.26%, to end at 17,024. The S&P 500 declined eight points or 0.39%, to 1,978. The Nasdaq Composite dropped 34 points or 0.77%, to 4,452.

Dozens of major companies are scheduled to report next week, including numerous Dow components. Profits are forecast to grow 6.2% for the quarter, according to Thomson Reuters data.

As the June payrolls report confirmed expectations that the economy rebounded in the second quarter, some analysts thought the data could prompt the US Federal Reserve to raise interest rates sooner than anticipated.

Cyclical stocks, which are tied to the pace of economic growth, ranked among the weakest of the day. Small-cap stocks also underperformed.

BioDelivery Sciences International Inc (BDSI.O) shares surged 8.9% after the company said its experimental pain drug, which it made with Endo International Plc (ENDP.O), was found effective in a late-stage trial.

GT Advanced Technologies (GTAT.O) tumbled 15.6% on heavy volume after UBS removed the company from its US Key Calls list.

Expedia Inc. slid 1.7% after agreeing to make a $658 million acquisition. Peabody Energy Corp. fell 3.7% to lead energy producers lower. PetSmart Inc. gained 2.5% after a second large shareholder prodded the company to consider selling itself.

Delta Air Lines Inc. sank 4.4% to the lowest since April and United Continental Holdings Inc. fell 3.2% as airlines retreated.

In Asia, shares declined from a six-year high on Tuesday as a stronger yen weighed on the earnings outlook for Japanese exporters.

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