Bank results impede Wall Street, trade hopes support European stocks

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NEW YORK (Reuters) – World stocks retreated from earlier gains on Monday as underwhelming quarterly results from U.S. banks weighed on Wall Street, though progress in U.S.-China trade talks helped European stocks tread water.

FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 9, 2019. REUTERS/Brendan McDermid

The U.S. benchmark S&P 500 stock index dipped after Goldman Sachs Group and Citigroup Inc both reported quarterly revenue below consensus estimates.

Wall Street’s negative turn weighed on MSCI’s gauge of global equities, which dropped 0.1%.

Investors are focused on the U.S. earnings season to gauge the strength of corporate America in the face of major challenges to growth.

While U.S. corporate earnings are widely expected to drop year-over-year for the first quarter, analysts anticipate an increase in revenue. As a result, equity investors will likely follow top-line results closely, said Oliver Pursche, chief market strategist at Bruderman Asset Management in New York.

“People are focusing on the revenue numbers, and they’re virtually in line if not slightly disappointing so far,” he said.

In Europe, the STOXX 600 edged up 0.1% as optimism over trade relations provided ballast for the index even as corporate