S&P 500 slips with energy shares, but financials bounce

By Caroline Valetkevitch

NEW YORK (Reuters) - U.S. stocks mostly edged lower on Monday following a drop in oil prices that weighed on energy shares and offset a jump in financial stocks as Bank of America's results reinforced expectations of a strong U.S. earnings season.

The S&P energy sector <.SPNY> fell 1.3 percent, leading percentage declines among the 11 major S&P sectors. Shares of Exxon Mobil slid more than 1.2 percent and Chevron fell 1.0 percent. The stocks were among the biggest drags on the benchmark index.

Crude oil prices fell about 4 percent as concerns about supply disruptions eased and Libyan ports reopened, while traders eyed potential supply increases by Russia and other oil producers.

 

Bank stocks rose, reversing their slide on Friday, when JPMorgan , Citigroup and Well Fargo reported results. Financials were the biggest boost to the Wall Street's three major indexes.

Bank of America rose 4.0 percent after the lender's quarterly profit beat analysts expectations on lower expenses and growth in loans and deposits. Goldman Sachs shares were up 1.5 percent ahead of its results due Tuesday.

The S&P financial sector gained 1.6 percent.

"It looks as though we're just taking a bit of a break after a good run last week," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

Investors may also be "doing trading as necessary," ahead of a slew of earnings reports this week and Federal Reserve Chairman Jerome Powell's first congressional testimony, he said.

The Dow Jones Industrial Average <.DJI> rose 12.17 points, or 0.05 percent, to 25,031.58, the S&P 500 <.SPX> lost 4.57 points, or 0.16 percent, to 2,796.74 and the Nasdaq Composite <.IXIC> dropped 26.04 points, or 0.33 percent, to 7,799.93.

The S&P 500 rose to its highest closing level in more than five months last week.

Analysts have forecast a near 21 percent surge in second-quarter earnings for S&P 500 companies, according to Thomson Reuters data.

Of the 30 S&P companies that have reported earnings through Friday, 86.7 percent have topped earnings expectations, above the 75-percent average of the past four quarters.

The S&P 500 retail index <.SPXRT> was up 0.3 percent. U.S. retail sales increased a strong 0.5 percent in June, Commerce Department data showed, indicating consumer spending accelerated in the second quarter.

Among stocks, shares of Arconic jumped 10.5 percent on a report that maker of aluminium parts used in planes, cars and buildings is the subject of takeover interest from private-equity firms.

Amazon.com Inc edged up 0.6 percent and was among the top boosts to the benchmark index as its 'Prime Day' shopping event kicked off.

Netflix was up 0.8 percent ahead of its earnings report due after the market's close.

Declining issues outnumbered advancing ones on the NYSE by a 2.27-to-1 ratio; on Nasdaq, a 1.87-to-1 ratio favoured decliners.

The S&P 500 posted 16 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 56 new highs and 59 new lows.

(Additional reporting by Amy Caren Daniel in Bengaluru; Editing by Arun Koyyur and Nick Zieminski)