Wall St down as Xerox shares drop

Trader John Panin, left, works on the floor of the New York Stock Exchange. File photo / AP

Wall Street moved lower overnight with disappointing earnings including from Xerox and the price of oil, while investors geared up for the two-day US Federal Reserve policy meeting starting on Tuesday.

Shares of Xerox sank, trading 12.2 percent at 3.08pm in New York, after the company reported results that fell short of expectations. It also downgraded some of its full-year estimates in part due to higher restructuring and separation costs.

"We have accelerated our cost reduction efforts across the company and expect to begin realising the benefits in the second quarter," Ursula Burns, Xerox chief executive officer, said in a statement.

Xerox said it was on track in its plans, announced earlier this year, to split itself into two publicly-traded companies.

In 3.02pm New York trading, the Dow Jones Industrial Average fell 0.34 percent, while the Nasdaq Composite Index slipped 0.32 percent. In 2.47pm trading, the Standard & Poor's 500 Index declined 0.37 percent.

"We have run into technical resistance now that we're near the record high," Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas, told Reuters. "People are taking some profits and stocks are looking a little bit expensive at the moment, especially since there is no earnings growth."

The Dow moved lower as slides in shares of Caterpillar and those of Visa, recently down 2.3 percent and 1.3 percent respectively, outweighed advances in shares of McDonald's and those of Wal-Mart, up 1.5 percent and 0.8 percent respectively.

"Whether you pin it on oil, or earnings or company-specific news, it doesn't really matter," Frances Hudson, an Edinburgh-based global thematic strategist at Standard Life Investments, told Bloomberg. "If you were to put all the headlines that are out there in front of you, there aren't any positive ones. Expectations are quite low for economic progress in terms of the data coming out this week."

In the latest news on the housing sector, a report on new home sales showed a surprise decline in March, sliding for a third straight month, to a 511,000 annualised pace. The median sales price fell 1.8 percent from March 2015 to US$288,000.
To be sure, analysts remained upbeat.

"Through some of the short-lived ups and downs in the data, it still appears that new home sales are trending higher over time," Daniel Silver, an economist at JPMorgan in New York, told Reuters.

In Europe, the Stoxx 600 Index ended the day with a 0.5 percent drop from the previous close.

France's CAC 40 index shed 0.5 percent, while both Germany's DAX index and the UK's FTSE 100 index dropped 0.8 percent.