Industrials weigh on Wall Street as earnings season looms

Industrials bogged down Wall Street on Monday, pulling the S&P 500 and the Dow lower as investors braced for what analysts now expect to be the first quarter of contracting earnings since 2016.

While the Nasdaq eked out a small gain, the Dow was down and the S&P 500 looked set to snap its seven-day winning streak.

Boeing Co was the heaviest drag on the Dow, falling 4.8% after the company said it would cut production of its 737 MAX aircraft in response to a worldwide grounding of the jets in the wake of the fatal Ethiopian Airlines crash on March 10.

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"The losses are concentrated, today," said Oliver Pursche, chief market strategist at Bruderman Asset Management in New York. "With the absence of news and heading into earnings there`s nothing particularly alarming in terms of today`s market action."

First quarter reporting period begins in earnest, with Delta Airlines, JPMorgan Chase & Co and Wells Fargo & Co results due later in the week, kicking off what analysts now expect to be the first quarter to show a year-on-year decline in earnings since 2016.

January-March profits for S&P 500 companies are now seen contracting by 2.3% from last year, according to Refinitiv data.

"My guess is that analysts are too pessimistic but not by a whole lot," Pursche added. "We have to wait and see but clearly it`s going to vary greatly by sector."

Of the 125 companies in the S&P 500 that have pre-announced first quarter results, 68% have come in below analyst expectations.

Aside from a potentially downbeat earnings period, investors are grappling with a number of unknowns on the horizon, including the expected release of the full Mueller report, the growing prospect of a no-deal Brexit, and increasing signs of a global economic slowdown.

The Dow Jones Industrial Average fell 121.15 points, or 0.46%, to 26,303.84, the S&P 500 lost 2.07 points, or 0.07%, to 2,890.67 and the Nasdaq Composite added 2.50 points, or 0.03%, to 7,941.19.

Of the 11 major sectors in the S&P 500, five were in the red.

Industrials, weighed down by Boeing and General Electric Co, were the biggest percentage losers.

General Electric dropped 7.3% after JPMorgan downgraded the industrial conglomerate`s stock to "underweight" from "neutral."

Boeing woes also weighed on the plane maker`s suppliers. Spirit AeroSystems and Triumph Group were down 7.1% and 5.1%, respectively.

New Age Beverage Corp shot up 27.4% on news that it would expand its tea and coffee brand Marley with Walmart Inc.

Snap Inc rose 4.3% following RBC Capital Markets` upgrade of the stock to "outperform."

Drugmaker Histogenics Corp soared 71.8% on news it would merge with privately-held Ocugen Inc.

Chipmaker Micron Technology Inc dipped 1.4% after Cowen downgraded the stock to "market perform," citing expected margin pressures.

Declining issues outnumbered advancing ones on the NYSE by a 1.08-to-1 ratio; on Nasdaq, a 1.26-to-1 ratio favored decliners.

The S&P 500 posted 25 new 52-week highs and no new lows; the Nasdaq Composite recorded 53 new highs and 23 new lows.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)