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NEW YORK: Wall Street fell on Monday as healthcare stocks slid and investors worried about rising costs for companies as oil prices rose, although the major indexes eked out a gain in April to snap a two-month losing streak.
The healthcare sector .SPXHC, which dropped 1.6 per cent, weighed most heavily on the SP 500, as shares of Allergan plc and Celgene Corp led the sector’s slide.
Some investors suggested that on balance, a strong earnings season has not been enough for US stocks to break out of their recent trading range.
“The earnings are priced in,” said Robert Phipps, a director at Per Stirling Capital Management in Austin, Texas.
“There’s not a whole lot of reason to buy.
We’re stuck in the mud right now.”
Oil prices rallied after Israeli Prime Minister Benjamin Netanyahu said Iran had lied about not pursuing nuclear weapons after signing a 2015 deal with global powers.
Even as companies’ quarterly results have come in strong, their earnings calls have raised concerns that rising commodity prices may pinch profit margins in the future.
The possibility that temporary exemptions on steel and aluminum tariffs might expire for several USallies also weighed on US stocks.
Without an extension from USPresident Donald Trump, the exemptions will expire on Tuesday.
“That might be the most negative (news event) this week,” said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco.
“It’s not going to be viewed well by the market.”
The Dow Jones Industrial Average fell index 148.04 points, or 0.61 per cent, to 24,163.15, the SP500 index lost 21.86 points, or 0.82 per cent, to 2,648.05 and the Nasdaq Composite dropped 53.53 points, or 0.75 per cent, to 7,066.27.
For the month, the SP 500 rose 0.27 per cent, the Dow added 0.25 per cent and the Nasdaq gained 0.04 per cent.
Earlier in Monday’s session, US stocks were helped by data on income and spending that kept broader inflation worries in check.
US personal income rose 0.3 per cent in March, compared with expectations of 0.4 per cent.
On the consumption side, personal spending growth in February was revised lower to 0.3 per cent, instead of the previously reported 0.4 per cent.
McDonald’s Corp shares jumped 5.8 per cent after the world’s biggest fast-food chain by revenue topped analysts’ forecasts for profit and sales.
Shares of Allergan fell 5.2 per cent after the company’s chief executive said he was opposed to fundamental changes to the drug company’s business strategy.
