All eyes on Alcoa as reporting starts
Stocks were sharply lower for most of the day as investors worried that an economic recovery will be slower than thought. Those fears helped send crude oil futures to a more than a six-week low, while copper, a barometer for global demand, hit a two-week low as commodities sold off across the board.
The earnings season unofficially began after the bell, with the release of results from aluminum giant Alcoa – which gained nearly 7 per cent – the first Dow component to report. Investors are concerned that companies will have little good news in their quarterly reports and outlooks.
The Dow Jones industrial average gained 14.81 points, or 0.18 per cent, to 8,178.41. The Standard & Poor’s 500 Index dropped 1.47 points, or 0.17 per cent, to 879.56. The Nasdaq Composite Index added 1.00 points, or 0.06 per cent, to 1,747.17.
The S&P Energy index fell 0.1 per cent as ConocoPhillips dropped 1.4 per cent to $39.44 as crude settled down 4.4 per cent to $60.14 per barrel. US Steel dropped 3.6 per cent to $30.50 with declining metal prices.
The US Energy Information Administration released data that showed gasoline and distillate inventories rose more than expected last week, pointing to ongoing weakness in demand, adding to fears about the economy.
Shares in the healthcare and consumer staples sectors, traditionally seen as better able to weather a weak economy, helped boost indexes as stocks such as Johnson & Johnson and Merck, both up around 1.5 per cent, helped push the Dow industrials into positive territory late in the session.
After a rally that pushed up the S&P 500 as much as 40 per cent from 12-year lows in early March, investors have been met with a rash of data – especially the weaker-than-expected June US payrolls report last week – that has undermined hopes for an economic rebound.