IE 11 is not supported. For an optimal experience visit our site on another browser.

Stocks weighed down by gloomy earnings

Wall Street finished Monday’s seesaw session lower, as oil prices seesawed and traders weighed lackluster earnings from Xerox Corp. against a surge in housing prices.
/ Source: The Associated Press

Wall Street finished Monday’s seesaw session lower, as oil prices seesawed and traders weighed lackluster earnings from Xerox Corp. against a surge in housing prices.

Investors were nervous about oil after crude futures’ rally on Friday. So stocks gave up early gains as oil crept upward; futures finally closed at $59 a barrel, unchanged on the New York Mercantile Exchange.

Stocks had advanced on news that the median price for existing homes in July was a record $219,000, a gain of 14.7 percent from the median, or midpoint, prices a year ago. That was the biggest jump in prices since November 1980 and another in a string of reports showing the nation’s economy continues to expand at a healthy pace.

But investors may stay on the sidelines until the Commerce Department releases its eagerly anticipated report on second-quarter gross domestic product numbers Friday, said Ed Peters, chief investment officer at PanAgora Asset Management Inc.

“A directionless market is usually a down market,” Peters said. “Right now, people are waiting instead of buying.”

The Dow Jones industrial average, which meandered for most of the day, finished with a loss of 54.70 points, or 0.5 percent, while the broader Standard & Poor’s 500-stock index, which has gained points for the last four weeks, lost 4.65 points, or 0.4 percent. The Nasdaq composite index slid 13 points, or 0.6 percent.

BellSouth Corp., the dominant local telephone provider in nine southeastern states, reported a more than 20 percent drop in second-quarter profit on a slight rise in revenue. The decline beat analysts’ expectations, and the stock rose 9 cents to $26.81.

But Xerox fell 85 cents to $13.20 after the maker of copiers and printers missed Wall Street estimates and gave third-quarter earnings guidance below analysts’ current forecasts. Goldman Sachs Group Inc. downgraded the stock.

Profits at American Express Co. soared 16 percent in the second quarter, handily beating analysts estimates. Stock in the credit card and travel company fell 1 cent to $54.56.

Wall Street has been lukewarm about second-quarter earnings, although most companies have beaten expectations. This week will see another cascade of reports, including many of the top companies in the S&P 500 index.

“If anything is going to move the market this week, it’s going to be news on the earnings front, which so far has been favorable,” said Mark S. Jordahl, chief investment officer at US Bancorp Asset Management.

In other company news, Generic drug maker Teva Pharmaceutical Industries Ltd. rose 1 cent to $31.17 after it said it is acquiring rival Ivax Corp. in a cash-and-stock deal worth about $7.4 billion. The price is about a 14 percent premium to Ivax’s closing price of $22.88 on Friday. Ivax rose $2.29 to $25.17.

Maytag Corp. said Sunday the $18-per-share, or $1.43 billion, purchase proposal it received from Whirlpool Corp. may be a better deal than one offered by a New York investment firm, but a company statement said Maytag remains hesitant to immediately open its books to Whirlpool.

On Friday, Whirlpool increased its bid to acquire Maytag by $1 per share. Maytag has signed an agreement to be bought by Triton Acquisition Holding Co., an investment group led by New York-based Ripplewood Holdings. Maytag rose 80 cents to $17 and Whirlpool rose $5.50 to $82.68.

Wal-Mart Stores Inc., the world’s biggest retailer, fell 9 cents to $49.45 after the company said it plans to open another 42 stores in China by the end of next year, nearly doubling its presence in the country, a senior company official said Monday.

Overseas, Japan’s Nikkei stock average rose 0.6 percent. Britain’s FTSE 100 gained 0.6 percent, Germany’s DAX index added 0.2 percent and France’s CAC-40 was up 0.2 percent.