Morgan Stanley, oil slide takes Wall St down

Stock traders work at the New York Stock Exchange. File photo / AP

Disappointing results from Morgan Stanley and a slide in oil dragging shares of Chevron and Exxon Mobil lower weighed on Wall Street.

In New York trading at about 1.30pm, the Dow Jones industrial average fell 0.16 percent, while the Standard & Poor's 500 Index shed 0.17 percent. The Nasdaq Composite Index rose 0.12 percent.

In the Dow, Chevron and Exxon Mobil, last down 2.1 percent and 1.8 percent respectively, outweighed gains in shares of Nike and those of Intel, last up 2.1 percent and 1.5 percent respectively.

Chevron and Exxon Mobil fell with the price of oil as the latest data from China underpinned concern about the country's slowing growth, and appetite for the world's commodities.

A report on Monday showed China's economy grew 6.9 percent in the July to September quarter, better than the 6.8 percent forecast but the worst quarter since 2009.

"The overall impression is that growth has stopped slowing but it's not rebounding either," Shane Oliver, head of investment strategy at fund manager AMP Capital Investors in Sydney. "Given that the risks remain on the downside and growth has slipped below 7 percent, further policy easing is likely."

Prices for gold, copper and nickel also weakened.

"The commodity complex is a bit weak," Veronika Pechlaner, an investment manager at Ashburton Investments, part of FirstRand Group, told Bloomberg. "That brings us back to earnings. We need to see reassurance that next year's numbers are OK for now. They should do better, and we hope to see more evidence of that."

However, shares of Morgan Stanley sank, last trading 5.8 percent weaker, after the US bank posted a disappointing quarterly profit. The outlook was not upbeat either.

"So far in the quarter, some of the key drivers that will likely drive client activity are mixed," Chief Financial Officer Jonathan Pruzan said on a call with analysts, Reuters reported. "Drivers of near-term uncertainty, including the Fed, China, commodities and global growth, have not diminished."

Companies including IBM, Yahoo, Boeing, General Motors, Caterpillar, McDonald's and Amazon.com will release their latest earnings this week.

On the bright side, confidence among US home builders rose in October, climbing to the highest level in a decade. The National Association of Home Builders/Wells Fargo housing market index rose to 64, the highest since October 2005, and up from 61 in September.
"With October's three-point uptick, builder confidence has been holding steady or increasing for five straight months.

This upward momentum shows that our industry is strengthening at a gradual but consistent pace," NAHB Chief Economist David Crowe said in a statement. "With firm job creation, economic growth and the release of pent-up demand, we expect housing to keep moving forward as we start to close out 2015."

In Europe, the Stoxx 600 Index ended the session with a 0.3 percent advance from the previous close. France's CAC 40 Index edged 0.03 percent higher, and Germany's DAX Index added 0.6 percent. The UK's FTSE 100 Index fell 0.4 percent.