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US STOCKS-Wall St flat as trade deal optimism wanes, earnings in focus

Published 14/10/2019, 17:10
© Reuters.  US STOCKS-Wall St flat as trade deal optimism wanes, earnings in focus
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* Energy companies among biggest drags on S&P 500

* Nike among top gainers on the Dow

* AECOM rises after deal to sell management services unit

* Indexes: Dow up 0.06%, S&P down 0.06%, Nasdaq up 0.01%

(Updates market action, adds comment)

By Arjun Panchadar and Sagarika Jaisinghani

Oct 14 (Reuters) - U.S. stocks stalled on Monday after three

straight sessions of gains as a bare-bones trade deal with China

announced on Friday dampened sentiment and triggered a 2% drop

in oil prices, ahead of the start of third-quarter earnings

season.

Oil majors Exxon Mobil Corp XOM.N and Chevron Corp CVX.N

were among the biggest drags on the S&P 500 index, as oil prices

gave up last week's gains on growing concerns that the partial

trade deal could take time to be sealed. O/R

The S&P 500 and Dow Jones indexes ended Friday with their

first weekly gain in a month after Washington signaled the two

sides had taken a major step in easing the tit-for-tat measures

that have hammered global growth this year. But the absence of details left investors feeling less

upbeat about what had really been achieved.

"Investors are trying to wrap their head around this 'non

deal'," said Robert Pavlik, chief investment strategist at

SlateStone Wealth LLC in New York.

"If (the market) was really skeptical, it would be selling

off a lot harder. But it's not because there are some good

points to it: that they are still talking and potentially

reaching a deal."

Shares of companies with a sizeable exposure to China,

including Nvidia Corp NVDA.O , Advanced Micro Devices Inc

AMD.O and Micron Technology Inc MU.O , slipped after gaining

on Friday. The Philadelphia Semiconductor index .SOX fell

0.3%.

Investors will now turn to the third-quarter earnings season

to gauge the impact of the trade conflict and a sluggish

domestic economy on corporate America.

The reporting season kicks off on Tuesday, with the big U.S.

banks expected to report a 1.2% decline in earnings due to

falling interest rates, a raft of unsuccessful stock market

floatations and trade tensions. Overall, analysts are forecasting a 3.2% decline in profit

for S&P 500 companies for the quarter from a year earlier, based

on IBES data from Refinitiv.

At 11:28 a.m. ET, the Dow Jones Industrial Average .DJI

was up 15.16 points, or 0.06%, at 26,831.75, while the S&P 500

.SPX was down 1.79 points, or 0.06%, at 2,968.48. The Nasdaq

Composite .IXIC was up 0.73 points, or 0.01%, at 8,057.77.

Nike Inc NKE.N was among the top Dow gainers after Bank of

America Merrill Lynch upgraded the stock to "neutral" from

"underperform".

Shares of U.S. construction and engineering company AECOM

ACM.N rose 5.5% after it agreed to sell its management

services unit for about $2.4 billion. Fastenal Co FAST.O was down 1.4% after two brokerages

downgraded the stock. The company had logged its best day in

three decades on Friday after reporting strong results.

Declining issues outnumbered advancers for a 1.56-to-1 ratio

on the NYSE and for a 1.56-to-1 ratio on the Nasdaq.

The S&P index recorded two new 52-week highs and three new

lows, while the Nasdaq recorded 14 new highs and 77 new lows.

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