Corporate results weigh on shares; oil rallies

Wed May 11, 2016 4:35pm EDT
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By Lewis Krauskopf

NEW YORK (Reuters) - U.S. and European stocks retreated on Wednesday amid disappointing corporate earnings, while oil prices surged for a second day as data showed U.S. crude inventories fell unexpectedly last week.

The U.S. dollar .DXY fell 0.5 percent against a basket of currencies after rallying for six consecutive days, as investors looked to book profits. The yen rebounded 0.7 percent against the dollar JPY=, halting declines against the greenback as Japan has threatened to intervene on its currency.

U.S. Treasuries extended their price gains after a strong government auction of $23 billion in 10-year notes.

Major U.S. stock indexes fell about 1 percent, while MSCI's broad gauge of global stocks .MIWD00000PUS slid 0.5 percent. On Tuesday, the global index had climbed nearly 1.1 percent, its best session in about a month, while the U.S. benchmark S&P 500 had tallied its best day in about two months.

“Traders are kind of pulling back on their horns, taking a little bit of risk off the table, looking for a reason to take some profit,” said Jason Ware, chief investment officer at Albion Financial Group in Salt Lake City.

The Dow Jones industrial average .DJI fell 217.23 points, or 1.21 percent, to 17,711.12, the S&P 500 .SPX lost 19.93 points, or 0.96 percent, to 2,064.46 and the Nasdaq Composite .IXIC dropped 49.19 points, or 1.02 percent, to 4,760.69.

The S&P and Nasdaq each snapped three-day winning streaks.

Disappointing profit reports from Disney (DIS.N: Quote) and Macy's (M.N: Quote) hurt stocks, with Disney the biggest drag on the Dow and the S&P 500, and Macy's weighing on retailers.   Continued...

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., May 6, 2016. REUTERS/Brendan McDermid