NEW YORK (Reuters) - Stocks lost ground on Monday, as investors drew back from recent gains that lifted the S&P 500 to a five-year high, in anticipation of sluggish growth in corporate profits.
Shares of financial companies dipped after a group of major U.S. banks agreed to pay a total of $8.5 billion to end a government inquiry into faulty mortgage foreclosures. The KBW bank index <.bkx>, a gauge of U.S. bank stocks, was down 0.3 percent.
Other sectors were hit as well, most notably energy and utilities. The S&P 500 energy sector index <.gspe> fell 0.8 percent and the utilities sector <.gspu> was off 1.1 percent.
The day's decline came a session after the S&P 500 finished at a five-year high, boosted by a budget deal and strong economic data. The S&P 500 rose 4.6 percent last week, the best weekly gain in more than a year.
"It's a little bit of taking some risk off the table ahead of profit season, you're not going to see anything all that great" on earnings, said Larry Peruzzi, senior equity trader at Cabrera Capital Markets Inc in Boston.
Earnings are expected to be only slightly better than the third-quarter's lackluster results, and analysts' current estimates are down sharply from where they were in October. Fourth-quarter earnings growth is expected to come in at 2.8 percent, according to Thomson Reuters data.
Aluminum company Alcoa Inc begins the reporting season by announcing its results after Tuesday's market close. Alcoa shares fell 1.7 percent at $9.10.
The Dow Jones industrial average <.dji> dropped 50.92 points, or 0.38 percent, to 13,384.29. The Standard & Poor's 500 Index <.spx> fell 4.58 points, or 0.31 percent, to 1,461.89. The Nasdaq Composite Index <.ixic> lost 2.84 points, or 0.09 percent, to 3,098.81.
Ten mortgage servicers - including Bank of America
In a separate case, Bank of America also announced roughly $11.6 billion of settlements with mortgage finance company Fannie Mae and a $1.8 billion sale of collection rights on home loans.
The bank also entered into agreements with Nationstar Mortgage Holdings
Bank of America shares lost 0.2 percent at $12.09 while Nationstar Mortgage Holdings
Citigroup shares were up 0.09 percent to $42.47, and Wells Fargo shares fell 0.5 percent to $34.77.
"The financials probably have the wind behind them now with a lot of the regulations coming out ... the market has to absorb a lot of the gains, and for that reason there's a pullback from this level," said Warren West, principal at Greentree Brokerage Services in Philadelphia.
Shares of U.S. jet maker Boeing Co
Amazon.com shares hit their highest price ever at $269.22 after Morgan Stanley raised is rating on the stock. Shares were up 3.6 percent at $268.46.
Video-streaming service Netflix Inc
Walt Disney Co
Volume was lower than average, as 4.78 billion shares were traded on the New York Stock Exchange, NYSE MKT and Nasdaq. This is well below the 2012 average of 6.42 billion per session.
Declining stocks outnumbered advancing ones on the NYSE by 1,629 to 1,363, while on the Nasdaq decliners beat advancers 1,438 to 1,066.
(Reporting By Gabriel Debenedetti; Editing by Kenneth Barry and Nick Zieminski)
Wall Street edges off five-year high, awaits earnings
This article
Wall Street edges off five-year high, awaits earnings
can be opened in url
http://newsintrafoliaceous.blogspot.com/2013/01/wall-street-edges-off-five-year-high.html
Wall Street edges off five-year high, awaits earnings
