(MENAFN- ProactiveInvestors - Australia) U.S. stocks fell Monday as investors awaited the start of the fourth quarter earnings season and as lawmakers look to the next showdown over the debt ceiling.
As of a half an hour to market close, the Dow was down 47 points to 13,388, the Nasdaq was lower by 3 points to 3,099, and the S&P 500 fell 4 points to 1,462.
With the fiscal cliff averted by the deal reached last week, traders are now free to focus on corporate America, but the outlook does not look too bright.
Fourth-quarter earnings for S&P 500 companies are expected to grow 2.8% compared to the same period in 2011, according to Thomson Reuters data.
As per usual, aluminum producer and economic bellwether Alcoa (NYSE:AA) will kickoff earnings season Tuesday after market close. Analysts expect earnings of 22 cents per share, versus 25 cents for the quarter that ended in September.
Mortgage lender Wells Fargo & Co. (NYSE:WFC) will also report earnings Friday.
In Washington, President Obama and Republicans in Congress last week reached a deal to hike tax rates for couples with an annual income that is greater than $450,000, avoiding the fiscal cliff.
But the deal simply delayed automatic spending cuts until March 1 and left negotiations for raising the nation's debt ceiling open.
Democrats say they want to raise as much as $1 trillion in new revenue through tax reform this year, and Republicans are against this. Congress has to move as soon as mid-February to keep the country out of default.
The banking sector was in focus Monday as federal regulators reached an $8.5 billion settlement with 10 large financial institutions over foreclosure abuses.
The deal includes $3.3 billion in cash payments to borrowers who underwent problematic foreclosures, and another $5.2 billion to homeowners at risk of losing their homes to foreclosure. The banks include Bank of America (NYSE:BAC), Citigroup (NYSE:C) Wells Fargo and J.P. Morgan Chase & Co. (NYSE:JPM), whose shares all fell, as well as six others.
Meanwhile, Bank of America (NYSE:BAC) said it reached a deal with Fannie Mae to settle all repurchase and other claims relating to substantially all residential mortgage loans originated and sold by Countrywide Financial and Bank of America National Association from 2000 to 2008.
The agreements with Fannie Mae cover loans with an aggregate original principal balance of approximately $1.4 trillion and an aggregate outstanding principal balance of approximately $300 billion.
In addition, the bank also said it agreed to sell its servicing rights on 2 million residential mortgage loans totaling around $306 billion. The sales involve approximately 2.0 million loans currently serviced by Bank of America, including approximately 232,000 loans classified as 60+ day delinquent first mortgage loans.
In other news, Intel Corp (NASDAQ:INTC) shares rose after Lazard Capital Markets upgraded the chipmaker to a buy from neutral. Intel, along with other tech companies, are presenting at the Consumer Electronics Show in Las Vegas.
Nvidia Corp (NASDAQ:NVDA) on Sunday announced a new mobile application processor as well as a handheld gaming console - its first consumer device.
Elsehwere, Yahoo (NASDAQ:YHOO) shares declined after Sanford C. Bernstein & Co. downgraded shares of the company, while Amazon.com (NASDAQ:AMZN) rose 4% after Morgan Stanley upgraded the online retailer.
Online video company Netflix (NASDAQ:NFLX) has signed a licensing deal that gives Netflix members access to prior seasons of certain television shows produced by Warner Bros.
In M&A news, shares of Illumina (NASDAQ:ILMN) fell over 6% after Roche Holding said it would not be making an offer for the maker of DNA-sequencing equipment. Illumina also said it signed a deal to acquire Verinata Health, a provider of non-invasive tests for the early identification of fetal chromosomal abnormalities, for $350 million plus up to $100 million in milestone payments through 2015.
On the economic front, no major releases came out today, with the calendar to remain light the rest of the week. Weekly jobless claims are up on Thursday, with trade deficit numbers and import prices due on Friday.
Commodities
Gold futures settled lower Monday for a third straight session after minutes from a Federal Reserve meeting released Thursday suggested that the central bank could bring its quantitative easing policy to an end this year.
Gold for February delivery fell $2.60, or 0.2%, to $1,646.30 an ounce on the Comex division of the New York Mercantile Exchange.
Meanwhile, February crude oil settled up 10 cents, or 0.1%, at $93.19 per barrel, as investors awaited this week's data on supplies.
Europe
European markets finished lower today with shares in France leading the region. The CAC 40 was down 0.68% while Germany's DAX was off 0.56% and Britain's FTSE 100 was lower by 0.41%.
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