U.S. stocks fell amid disappointing earnings from Caterpillar Inc. to 3M Co., while copper’s slide to a two-week low hit mining shares. Oil sank into a bear market and the dollar’s rally paused near a three-month high.
The Standard & Poor’s 500 Index fell 0.6 percent by 4 p.m. in New York, capping a third daily loss after briefly topping its record Monday. Caterpillar and 3M lost at least 3.6 percent and Freeport-McMoRan Inc. led miners lower as Goldman Sachs Group Inc. warned copper could fall another 16 percent. The Bloomberg Dollar Spot Index declined 0.1 percent, hovering near its strongest level since April. Amazon.com Inc. soared 17 percent in extended trading after posting a surprise profit.
The earnings season has been spotty for U.S. companies so far, with sluggish demand overseas damping returns for some multinational companies. The Bloomberg Commodity Index extended losses at a 13-year low, with Goldman saying it expects Chinese demand for copper to grow at the slowest pace in almost two decades. The dollar meandered as traders started to focus on the outlook for next week’s meeting of the Federal Reserve.
“Investors have been somewhat surprised at how unimpressive earnings have been considering where the stock market is,” said Jeff Sica, who oversees over $1.5 billion as president and chief executive officer of Circle Squared Alternative Investments in Morristown, New Jersey. “Earnings have not proven to be the catalyst they’ve looked for.”
Materials producers in the S&P 500 lost 1.6 percent Thursday as the commodity rout continued. West Texas Intermediate settled in a bear market, with losses in the past six week topping 20 percent as resilient U.S. output, rising OPEC supply and threats to Chinese demand keep a global glut in place.
Gold futures for August delivery settled higher by 0.2 percent, halting 10 days of losses. The price touched $1,080 on Monday, the lowest since February 2010, and is down 16 percent in the past 12 months.
Commodity stocks “are not out of the woods yet because the macro plays against them -- China slowdown, overcapacity for mining, and continued downturn in gold prices,” aid Pierre Mouton, who helps manage $8.3 billion at Notz, Stucki & Cie. in Geneva.
Earnings per share at S&P 500 companies probably slumped 5.3 percent in the second quarter, according to analysts’ estimates, weighed down by tumbling oil and commodities prices and slow global economic growth.
Disappointing results from Apple Inc. and Microsoft Corp. sparked a selloff in technology shares Wednesday, though gains in financial shares muted losses in the S&P 500. The index on Monday briefly topped its closing record before ending below it, continuing a pattern of rising to the brink and then failing to break through. The gauge is 1.3 percent from its May 21 high.
Caterpillar, the largest manufacturer of construction and mining machinery, cut its full-year sales forecast Thursday, saying important end-user industries remain weak. 3M reduced the top end of its 2015 profit and revenue, citing lower-than-expected global economic growth.
SanDisk Corp. led a rebound in tech shares Thursday, rising the most since 2009 after results topped estimates. Apple and Microsoft led gains in the Dow Jones Industrial Average.
Analysts now call for a 5.3 percent drop in second-quarter profit, shallower than July 10 estimates for a 6.4 percent decline.
The dollar depreciated 0.6 percent to $1.0995 per euro, after reaching $1.1005, the weakest level since July 15. It fell 0.1 percent to 123.81 yen. The U.S. currency had appreciated amid speculation on when, and how many times, the Fed will raise rates this year.
Odds for a September liftoff remain at 50 percent, exactly where they were in June, according to the median of 46 responses in a July 20-22 survey, despite six weeks of turmoil from Greece to China.
The benchmark U.S. 10-year Treasury yield dropped 0.4 basis points to at 2.28 percent. The rate will rise to 2.53 percent by Dec. 31 and reach 3.23 percent by the end of 2016, according to weighted-average forecasts of analysts surveyed by Bloomberg.
In Europe, the Stoxx 600 fell for a third day as a decline in energy shares outweighed better-than-expected results from Credit Suisse Group AG and Unilever.
Pearson Plc gained 2.1 percent after saying it agreed to sell the Financial Times business daily to Japan’s Nikkei Inc.