NASDAQ Erases Gains Ahead of Earnings Season Start
The NASDAQ Composite Index turned lower ahead of the close on Monday as investors brace for the corporate earnings season that starts with results from aluminum producer Alcoa Inc (NYSE:AA).
The tech heavy gauge traded higher earlier in the day as oil prices climbed back over $40 a barrel and the U.S. dollar weakened further against most of its competitors.
At 3:41 p.m. in New York, the NASDAQ Composite was down 12 points, or 0.3%, at 4,837. The measure had rallied to as high as 4,897 earlier in the morning.
The gauge posted 51 new 52-week highs and 27 new lows as 1.0 billion shares changed hands.
The S&P 500 also turned lower, losing 0.2% to 2,042, whereas the 30-member Dow Jones Industrial Average (DJIA) was little changed at 17,583, paring an earlier advance.
Alcoa unofficially kicks off the reporting season after the market close. The New York company is expected to report a third straight quarter of declines in both earnings and revenue.
Those results will come amid projections that S&P 500 companies will deliver the worst earnings quarter since 2009.
Oil Back to $40; Dollar Weakens
A third straight week of declines in the number of U.S. oil rigs helped West Texas Intermediate for May delivery to finish at $40.20, up 1.2%.
The weak dollar helped the gold price to rise 1.1% to $1,258 an ounce on Comex, its third straight session advance.
The greenback was down 0.1% against the Japanese currency to 107.95 yen, after touching a fresh 17-month low of 107.63 yen earlier in the day.
The U.S. dollar index, which compares the greenback to a basket of currencies, fell 0.5% to 93.75, near its 93.50 bottom touched on August 24.
Chesapeake Surges on New Debt Deal
Chesapeake Energy Corporation (NYSE:CHK) soared 19% to $4.49 after the U.S. natural gas driller reached an amended agreement with its lenders that allows it to borrow as much as $2.5 billion and offers relief on some terms of its debt covenants.
Yahoo Inc. (NASDAQ:YHOO) advanced 1.7% to $36.69 after the owner of U.K.’s Daily Mail emerged as a possible bidder for the ailing Internet group’s assets, The Wall Street Journal reported.
Hatteras Financial Corp. (NYSE:HTS) jumped 11% to $15.80. The mortgage real estate investment trust will be sold to rival Annaly Capital Management, Inc. (NYSE:NLY) for $1.5 billion in cash and stock, or $15.85 per share. Shares of Annaly were flat at $10.40, erasing an earlier loss.
United Continental Holdings Inc (NYSE:UAE) rose 1.7% to $54.00 even as the Chicago, Illinois-based company projects a drop of up to 7.8% in its revenue per available passenger seat mile, pressured by a strong dollar and a decline in travel by customers whose businesses are hurt by weak oil prices.
The NASDAQ Composite, unlike the S&P 500 and the Dow Jones Industrial Average, has not yet erased its year-to-date losses, which currently stand at 3.3%.