Investing.com - U.S. stocks plunged on Monday after investors
sold for profits and jumped to the sidelines before earnings season
gears up this week, while uncertainty over U.S. monetary policy
also dampened equities prices.
At the close of U.S. trading, the Dow Jones Industrial Average fell
1.09%, the S&P 500 index fell 1.26%, while the Nasdaq Composite
index fell 1.47%.
On Friday, U.S. metals giant Alcoa kicked off the earnings season
with mixed fourth-quarter results.
The company posted a loss of USD0.04 a share, missing market
estimates for USD0.06 a share,
Revenue came in at USD5.56 billion, which beat some forecasts.
This week will see financial institutions JPMorgan Chase & Co.,
Bank of America Corp., Goldman Sachs, and Citigroup Inc. release
earnings, and uncertainty ahead of time sent investors to the
sidelines as did U.S. monetary uncertainty.
The Bureau of Labor Statistics on Friday reported that the U.S.
economy added 74,000 jobs in December, well below expectations for
a 196,000 increase and below an upwardly revised 241,000 rise the
The numbers boosted expectations for the Federal Reserve to trim
its USD75 billion monthly bond-buying program at a slower pace than
once expected, though by Monday, sentiments grew the December jobs
report may be an anomaly and the product of bad winter weather that
put off hiring.
Fed asset purchases tend to weaken the dollar by suppressing
long-term interest rates, thus making stocks an attractive buy, and
expectations for further tapering of such ultra-loose policies tend
to send stock prices falling.
Earlier Monday, Federal Reserve Bank of Atlanta President Dennis
Lockhart said the U.S. economy is on "solid footing" and added that
he would support further cuts to monthly bond purchases.
Stocks also remained under pressure amid uncertainty ahead of
Tuesday's U.S. retail sales report, a widely-watched indicator of
U.S. economic and corporate health.
Leading Dow Jones Industrial Average performers included Merck, up
6.55% on news the company will seek early approval for a cancer
drug, Cisco, which was down 0.07%, and Intel, down 0.10%.
The Dow Jones Industrial Average's worst performers included
Microsoft, down 2.96%, Walt Disney, down 2.82%, and Nike, down
European indices, meanwhile, finished higher.
After the close of European trade, the EURO STOXX 50 rose 0.17%,
France's CAC 40 rose 0.30%, while Germany's DAX 30 rose 0.39%.
Meanwhile, in the U.K. the FTSE 100 finished up 0.26%.
On top of U.S. retail sales, the U.S. on Tuesday will release data
on import prices and business inventories.
Also Tuesday, Federal Reserve Bank of Philadelphia President
Charles Plosser and Dallas Fed President Richard Fisher are to
offers an extensive set of professional tools for the financial
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