WASHINGTON: US stocks began a heavy week of earnings reports on a down note Monday, with a drop in oil prices sending leading oil producers lower. Wall Street stocks were in negative territory much of the day, following declines of one percent or more in Paris and Frankfurt and a modest drop in London. Petroleum-linked shares fell on Wall Street, as oil prices declined due to pressure from the stronger dollar. Midsized oil producers suffered the most dramatic falls, with Devon Energy losing 3.3 percent and Marathon Oil 4.1 percent. It was a fairly light day for US economic data releases. This week’s calendar of earnings includes Coca-Cola, General Motors, Disney and Expedia.
Briefing.com analyst Patrick O’Hare said technical factors played a role in Monday’s retreat after a big rally in US stocks Friday. Other factors weakening stocks were lingering questions about US policy implementation under President Donald Trump and political uncertainty in the eurozone due to the upcoming French and German elections, he said.
“The political uncertainty will stifle things from time to time, but insomuch as the US stock market is concerned, it still connotes an otherwise hopeful view of matters,” O’Hare said. Some European analysts have a less sanguine view of the outlook in the US, pointing to Trump’s unpredictability and controversies surrounding his trade and immigration policies. Jasper Lawler of London Capital Group said the feeling on markets was one of aversion to risk. He cited the conflict between Trump and the US courts after a federal judge blocked the temporary ban on refugees and travellers from seven Muslim-majority countries. “The decision to overrule Donald Trump’s travel bans edges the US one step closer to the kind of constitutional crisis that nobody would want to invest in,” Lawler said.
