NEW YORK -- U.S. stocks slipped in quiet trading Monday as energy companies dropped with the price of oil. Metals and chemicals companies also fell. Company earnings remain weak, and Xerox and drugmaker Perrigo tumbled after reporting disappointing results and cutting their forecasts for the year.
Stocks looked like they were headed for big losses in the morning, as the Dow Jones industrial average dropped as much as 148 points. Stocks recovered most of those losses over the last hours of trading. Investors traded less than usual as they looked through a weak group of company earnings and prepared for the latest Federal Reserve meeting, which will conclude Wednesday.
"The market is being restrained as much by uncertainty over ... companies' ability to generate earnings growth and revenue growth as they are around uncertainty over Fed policy," said Justin Christofel, portfolio manager with BlackRock's Multi-Asset Income Fund.
Over the last week, com
pany earnings have generally been better than expected, but Christofel said that's because investors weren't expecting much.
The Dow Jones industrial average fell 26.51 points, or 0.2 percent, to 17,977.24. The Standard & Poor's 500 index lost 3.79 points, or 0.2 percent, to 2,087.79. The Nasdaq composite index slid 10.44 points, or 0.2 percent, to 4,895.79.
Xerox cut its earnings estimate for the year after its first-quarter profit plunged 85 percent. The company's revenue fell, and costs went up as it gets ready to split into two businesses. The stock shed $1.49, or 13.3 percent, to $9.68.
Irish drugmaker Perrigo skidded after it cut its profit forecast. The company said prices for over-the-counter products in Europe are down, and it may take an impairment charge for a business it bought just a year ago. Perrigo chairman and CEO Joseph Papa also left the company to join Valeant Pharmaceuticals. The stock lost $21.95, or 18.1 percent, to $99.40.
About a third of the companies in the S&P 500 will report their earnings this week. Wall Street isn't feeling optimistic: according to Lindsey Bell of S&P Global Market Intelligence, analysts think earnings will fall 8 percent. That's the third straight quarterly decline, and the largest in seven years.
"Earnings have been revised down viciously this quarter," Christofel said.