US open: Wall Street slips amid weak tech earnings, downbeat GE

Wall Street was slightly lower in early trading following disappointing updates from Microsoft and Ebay, alongside weak guidance from industrial conglomerate GE.

At 1603 BST, the Dow Jones Industrial Average was lower by 0.42% or 89.75 points to 21,522.03, the Nasdaq Composite was down by 0.30% or 19.22 points to 6,370.78 and the S&P 500 were flat.

From a sector standpoint, the worst performing areas of the market were: Auto Parts (-2.37%), Coal (-2.23%) and Railroads (-1.60%).

Commenting on the price action on Wall Street at the end of the week, Chris Beauchamp, chief market analyst at IG said "predictions of a summer slump in equities have been proved correct, and very quickly, as yesterday’s weakness in European stocks crosses the Atlantic.

"It looks increasingly like the rally has run its course for the time being, although the prospect of a barrage of earnings over the next two weeks offers the chance of salvation. The strong run this year is entirely consistent with an average year for equities, with a strong first half followed by weakness into the fourth quarter."

Acting as a backdrop, JPMorgan said in an equity strategy note that global earnings growth remains intact, with the most notable improvement in Europe and to some extent emerging markets, while US growth remains solid.

"In our recent report we argued for upside risk to both S&P 500 price and earnings if central bank expectations continued to converge and USD further weakened. So far this year, Europe/Japan versus US interest rate differentials have narrowed on average by around 35bps and USD has declined by more than 7% on a trade-weighted basis.

"Our analysis suggests for every 2% decrease in USD, S&P 500 EPS has historically been revised up by around 1%. Looking ahead, we expect another upbeat reporting season with 2Q17 EPS coming in at circa $32.50 (consensus $31.54) on above-trend revenue growth and better than expected margins."

General Electric was a top faller after the conglomerate guided towards the lower-end of its previous full-year forecasts for earnings per share and revenues.

Shares of Honeywell on the other hand were trading on the frontfoot after delivering better-than expected second quarter top and bottom line figures.

Oil field services outfit Schlumberger also bested analysts's forecasts with its numbers, helping its shares edge higher.