U.S. stocks traded lower Tuesday as renewed declines in oil prices weighed amid mixed reaction to some key earnings reports.
Shares of Exxon Mobil declined about 3 percent after the firm reported a 58 percent drop in profit, hurt by low oil prices. The world’s largest publicly traded oil company also said it would cut spending this year by one-quarter, Reuters reported.
U.S. crude oil futures traded about 5 percent lower, struggling to hold $30 a barrel. Concerns about demand and rising supply continued to weigh as hopes for a deal between OPEC and Russia on output cuts faded.
“The oil rally, which occurred around those rumors (about an output cut), has reversed and dragged down the stock market and long-term interest rates,” said David Kelly, chief global strategist at JPMorgan Funds.
The U.S. dollar held slightly lower against major world currencies, with the euro near $1.093 and the yen at 120.27 yen against the greenback.
The S&P 500 fell more than 1 percent in morning trade, as energy declined more than 3 percent to lead all sectors lower.
“I think we’re settling into a range-bound area until the Friday employment report,” said Ilya Feygin, managing director and senior strategist at WallachBeth Capital.
“In general the earnings season hasn’t been super bad. It hasn’t been the problem. The problem has been weaker oil and overall growth,” he said.
The Nasdaq composite also fell more than 1 percent as Apple, biotechs and several major tech stocks declined.
The company reported earnings after the close Monday that beat on both the top and bottom line, helped by a 17 percent rise in advertising revenue. A key advertising metric of aggregate paid clicks increased 31 percent from the previous year, beating consensus expectations of about 22 percent, according to StreetAccount.
A jump in the shares in morning trade Tuesday put Google on pace to top Apple as the world’s most valuable company.
Read More: What could move markets Tuesday
Auto sales for January are the only major data out Tuesday, ahead of Friday’s jobs report.
Kansas City Fed President Esther George, voting member, is scheduled to speak on the economy at 1 p.m. ET.
In political news, Texas Senator Ted Cruz beat out national front-runner Donald Trump in the GOP’s Iowa caucuses, according to NBC News. Florida Senator Marco Rubio surprised many with a solid third place finish.
Read More: What Iowa tells us about the 2016 race now
Kelly said the results could be neutral to slightly positive for markets. “The way votes came out last night seemed to focus on more centrist candidates on both sides,” he said.
The S&P 500 fell 25 points, or 1.29 percent, to 1,914, with energy leading all 10 sectors lower.
The Nasdaq composite dropped 49 points, or 1.08 percent, to 4,570.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 21.5.
About five stocks declined for every advancer on the New York Stock Exchange, with an exchange volume of 249 million and a composite volume of nearly 1.1 billion.
Crude oil futures for March delivery fell $1.24 to $30.38 a barrel on the New York Mercantile Exchange. Gold futures for April delivery gained $1.20 to $1,129.20 an ounce.