By Leslie Josephs And Tommy Stubbington
Global stocks were mixed Friday as downbeat earnings reports
from large oil companies weighed on the energy sector.
The Dow Jones Industrial Average fell 20 points, or 0.1%, to
17726, while the S&P 500 edged up nearly 2 points, or 0.1%, to
2110.59.
The Nasdaq Composite Index gained 15 points, or 0.3%, at
5143.79.
On the other side of the Atlantic, the Stoxx Europe 600 fell
0.5% to 394.12.
Disappointing earnings from oil majors Chevron Corp. and Exxon
Mobil Corp.--the result of a yearlong slump in crude prices--pushed
the Dow lower.
Exxon, the biggest U.S. oil company, reported a 52% drop in
profit for its second quarter. Shares were down 4.6% at $79.18.
Chevron shares were 4.3% lower at $88.75 after it reported $2.6
billion in charges in its quarterly statement tied to lower oil
prices.
"That should not surprise anyone," Randy Frederick, managing
director of trading and derivatives at Charles Schwab, said of the
oil companies' results.
Nymex oil prices fell 50% over the past 12 months. U.S. oil
futures were recently down 1.2% at $47.94 a barrel.
Shares of Coca-Cola Enterprises Inc. rallied 10.8% at $50.37
following news of merger talks with Coke bottlers Coca-Cola Iberian
Partners and Germany's Coca-Cola Erfrischungsgetränke AG.
Shares of Hanesbrands Inc. dropped 11.4% to $30.19 after the
apparel maker posted second-quarter sales below analyst
estimates.
Shares in Airbus Group climbed after the plane maker reported a
rise in second-quarter profit. French bank BNP Paribas and chemical
company Arkema both rose after better-than-expected results. Steel
pipe maker Vallourec fell after reporting a loss for the first half
of the year.
Among companies on the Stoxx Europe 600 that have so far
reported second-quarter results, 54% have exceeded profit
expectations, according to FactSet data. That compares with 50% in
the first quarter.
"The earnings season in Europe has been pretty good," said
Christian Stocker, an analyst at UniCredit. Concerns over the
Chinese economy are likely to remain and could hold back shares in
mining companies and car makers in the coming months, he said.
Shares in the U.S. and Europe had fallen sharply at the start of
the week as a slump in Chinese equities spilled over into global
markets, but have since more than recovered those losses as
investors turned to corporate earnings and clues on the timing of a
Federal Reserve rate increase.
The U.S. employment-cost index, a measure of workers' wages and
benefits, rose a seasonally adjusted 0.2% in the second quarter
from the first quarter, the Labor Department said Friday. The gains
marked the smallest quarterly rise since record-keeping began in
1982, and fell below economists' expectations of a 0.6% increase.
But a quarterly measure of U.S. labor costs indicated stagnated
wages, casting some doubt on the Federal Reserve's plans to raise
rates in the coming months.
The dollar weakened 1.3% against the euro, as one euro bought
$1.11 versus $1.0933 on Thursday.
Currency markets have gyrated in recent months amid an uncertain
outlook for U.S. and global growth, as well as questions about
whether the Fed will raise the short-term benchmark interest rate
in September. Higher interest rates would make the dollar a more
alluring investment to investors.
Gold prices were recently up 0.6% at $1,095.80 a troy ounce on
the Comex division of the New York Mercantile Exchange. A weaker
dollar lent support to the precious metal, which is priced in
dollars and becomes less expensive for investors using stronger
currencies. Still, gold is on track to post a 6.5% monthly loss in
July, the worst drop since April 2013.
James Ramage contributed to this article.
Write to Leslie Josephs at leslie.josephs@wsj.com and Tommy
Stubbington at tommy.stubbington@wsj.com