U.S. Stocks Drop As Markets Eye Gaza, Ukraine

@AFP
U.S. Stocks Drop As Markets Eye Gaza, Ukraine

New York (AFP) — U.S. stocks Monday moved lower in early trade as investors eyed conflicts in Gaza and Ukraine at the start of a busy week of corporate earnings.

About 20 minutes into trade, the Dow Jones Industrial Average fell 70.96 points (0.41 percent) to 17,029.22.

The broad-based S&P 500 declined 6.53 (0.33 percent) to 1,971.69, while the tech-rich Nasdaq Composite Index gave up 12.45 (0.28 percent) at 4,419.69.

At an urgent meeting on Gaza, the UN Security Council urged an “immediate cessation of hostilities” in a call echoed by U.S. President Barack Obama in a telephone conversation with Israeli Prime Minister Benjamin Netanyahu.

Meanwhile, Dutch forensics experts began examining bodies from a Malaysian plane disaster that have been held up at an east Ukraine train station as Kiev and insurgents wrangle over the fate of the remains. Russia has faced sharp criticism over its involvement in Ukraine in the wake of the incident.

The market is also looking ahead to earnings announcements this week from several closely-watched companies, including Apple, Boeing, and Facebook.

Oil-services company Halliburton gained 1.2 percent after net income for the second quarter rose 20 percent to $774 million and the company announced it had authorized $4.8 billion in additional stock repurchases.

Pharmaceutical company Allergan, which is fighting off an unsolicited takeover bid by Valeant Pharmaceuticals International, announced it was cutting 1,500 employees, about 13 percent of its workforce, plus another 250 vacant positions. Shares rose 0.6 percent.

Fast-food chains McDonald’s and Yum Brands were under pressure as Shanghai officials shut a food supplier to the companies because of allegations workers at a factory mixed expired meat with the fresh product. Dow component McDonald’s lost 0.9 percent, while Yum, which owns the KFC chain, dropped 2.5 percent.

Reynolds American dropped 2.0 percent after a Florida jury ordered the tobacco company to pay $23.6 billion to the wife of a longtime smoker who died of lung cancer. A Reynolds executive called the award “grossly excessive” and said he was confident the sum would not be upheld on appeal.

Jewelry company Tiffany dipped 0.3 percent as it announced that chief executive Michael Kowalski would retire in March 2015 and would be succeeded by president Frederic Cumenal.

Bond prices rose. The yield on the 10-year U.S. Treasury dipped to 2.47 percent from 2.48 percent Friday, while the 30-year fell to 3.27 percent from 3.29 percent. Bond prices and yields move inversely.

AFP Photo/Spencer Platt

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