US stocks slip as energy companies fall along with oil prices
US stocks have slipped during quiet trading on Monday as energy companies dropped with the price of oil.
Metals and chemicals companies also fell.
Company earnings remain weak, and Xerox and drugmaker Perrigo tumbled after reporting disappointing results and cutting their forecasts for the year.
Stocks looked like they were headed for big losses in the morning, as the Dow Jones industrial average dropped as much as 148 points.
Stocks recovered most of those losses over the last hours of trading. Investors traded less than usual as they looked through a weak group of company earnings and prepared for the latest Federal Reserve meeting, which will conclude on Wednesday.
Over the last week, company earnings have generally been better than expected, but analysts believe this is because investors are not expecting much.
The Dow Jones industrial average fell 26.51 points, or 0.2%, to 17,977.24. The Standard & Poor's 500 index lost 3.79 points, or 0.2%, to 2,087.79. The Nasdaq composite index slid 10.44 points, or 0.2%, to 4,895.79.
Xerox cut its earnings estimate for the year after its first-quarter profit plunged 85%. The company's revenue fell, and costs went up as it gets ready to split into two businesses. The stock shed 1.49 dollars (£1), or 13.3%, to 9.68 dollars (£6.71).
Irish drugmaker Perrigo skidded after it cut its profit forecast. The company said prices for over-the-counter products in Europe are down, and it may take an impairment charge for a business it bought just a year ago. Perrigo chairman and CEO Joseph Papa also left the company to join Valeant Pharmaceuticals. The stock lost 21.95 dollars (£15.23), or 18.1%, to 99.40 dollars (£69).
About a third of the companies in the S&P 500 will report their earnings this week. Wall Street isn't feeling optimistic: according to Lindsey Bell of S&P Global Market Intelligence, analysts think earnings will fall 8% - the third straight quarterly decline, and the largest in seven years.
Investors kept their powder dry as they waited to see what central banks in the US and Japan will do. The Federal Reserve will meet Tuesday and Wednesday, and while investors do not think the Fed will raise interest rates this month, they will review the Fed's comments about the state of the US and global economy. Bank of Japan officials will meet later in the week and could take new actions to stimulate the Japanese economy.
Benchmark US crude fell 1.09 dollars (75p), or 2.5%, to 42.64 dollars (£29.60) a barrel in New York. Brent crude, used to price international oils, lost 63 cents, or 1.4%, to 44.48 dollars (£31) a barrel in London. Transocean stock lost 53 cents, or 4.9%, to 10.26 dollars (£7.12) and Hess fell 1.51 dollars (£1), or 2.4%, to 61.87 dollars (£43).
Gannett, the owner of USA Today and other papers, offered to buy Tribune Publishing for 388 million dollars (£269). Tribune owns 11 newspapers including the Los Angeles Times and Chicago Tribune. It said Tribune has refused to start constructive talks.
The offer values Tribune Publishing at 12.25 dollars (£8.50) per share. Tribune jumped 3.98 dollars (£2.76), or 52.9%, to 11.50 dollars (£8). Gannett's stock rose 1.02 dollars, or 6.5%, to 16.79 dollars (£11.65).
The federal government approved Charter Communications' bid to buy Time Warner Cable. Time Warner Cable stock rose 8.18 dollars (£5.67), or 4.1%, to 209.63 dollars (£145) and Charter added 9.10 dollars (£6.31), or 4.6%, to 207.01 dollars (£143.67).
If California utility regulators approve the deal, which they are expected to do, Charter will become the second-largest internet provider and third-largest video company in the US.