Stocks fell back into the red Friday afternoon as a lag in financial stocks overshadowed a push higher by the energy sector.
The S&P 500 was down 0.15%, the Dow Jones Industrial Average slid 0.2%, and the Nasdaq slipped 0.19%.
Financials fell, led by KeyCorp (KEY - Get Report) which stumbled more than 6% after agreeing to acquire First Niagara Financial (FNFG) for $4.1 billion. Other financials stocks including Citigroup (C - Get Report) , Bank of America (BAC - Get Report) , Wells Fargo (WFC - Get Report) , and JPMorgan (JPM - Get Report) were also lower, while the Financial Select Sector SPDR ETF (XLF - Get Report) slid 1.4%.
The number of active rigs in the U.S. dropped by 12 to 775 over the past week. Active oil-drilling rigs fell 16 to 578. West Texas Intermediate crude oil closed 1.2% higher to $46.59 a barrel. The commodity was up 4.5% for the week and 3.3% for the month.
The energy sector was the best performer on markets, led by Exxon Mobil (XOM - Get Report) after the oil giant beat earnings and sales forecasts and Chevron (CVX - Get Report) which committed to cut as many as 7,000 jobs and reduce capital spending by 25%.
Other major oilers including Royal Dutch Shell (RDS.A - Get Report) , PetroChina (PTR - Get Report) , BP (BP - Get Report) and Statoil (STO) rose, while the Energy Select Sector SPDR ETF (XLE - Get Report) added 1.5%.
U.S. equities were on track for their best monthly gain in four years. Each have surged more than 8% since the beginning of October.
Benchmark indexes have rallied in October as China and the European Central Bank committed to do whatever it takes to reinvigorate flagging growth. Markets in the U.S. rallied on Wednesday after the Federal Reserve held rates steady. However, a potential December rate hike was left in play. Investors had hoped the Fed would provide further clarification on how likely a rate hike this year might be.
Chicago PMI bounced back into positive territory in October, climbing to a reading of 56.2 from 48.7 in September. The reading was its highest since January, boosted by gains in new orders and production.
Consumer sentiment moved higher to a reading of 90 in October from 87.2 in September, according to the University of Michigan, as global market volatility eased and gasoline prices remained low. However, the index wasn't as high as a preliminary reading of 92.1.
Consumer spending rose in the U.S. in September at the slowest pace this year as consumers spent less on gasoline. Personal spending increased 0.1% over the month, according to the Commerce Department, half the increase economists had expected. Consumers have also become more conservative in recent weeks as the global market looked to be on shakier ground and the U.S. labor market showed signs of weakness.
Drugstore chain CVS Health (CVS - Get Report) led S&P 500 decliners after it guided for 2016 earnings no higher than $5.88 a share, below analysts' estimates of $6.02. The company has managed to boost pharmacy sales even as its drugstore business suffers following the decision to cease all tobacco sales.
Colgate-Palmolive (CL - Get Report) was one of the worst performers in the sector after reporting a drop in quarterly sales due to a stronger U.S. dollar. Total revenue fell nearly 9% to $4 billion with the impact of foreign exchange cutting into the top-line by 13 percentage points. Organic sales increased 5% and were up 8% in emerging markets.
Anheuser-Busch (BUD) shares were on watch after the beer company raised its sales forecast for the year on stronger demand for premium lager. The company is currently planning to buy its rival SABMiller (SBMRY) in what will be a record deal for the beer industry.
AbbVie (ABBV - Get Report) climbed more than 5% after reporting an 18% jump in total revenue. The drugmaker narrowed its full-year earnings guidance to $4.26 to $4.28 a share from a previous range of $4.10 to $4.30.
Starbucks (SBUX - Get Report) shares fell 2% after the coffee chain provided a weaker-than-expected forecast for the holiday season, while LinkedIn (LNKD) jumped 10% after reporting a 37% increase in quarterly sales on its expansion in China.
SolarCity (SCTY) shares slumped more than 18% after losses widened to $234 million over its recent quarter from just $70 million in the year-ago period. An adjusted loss of $2.10 a share was wider than an expected $1.95 loss. Revenue climbed on increased installations of its alternative-energy systems.
Valeant (VRX) announced it is cutting ties with specialty pharmacy Philidor after Express Scripts and CVS Health eliminated the partner pharmacy from their network. Valeant has been under pressure since last week when a Citron Research report accused it of using the pharmacy to create fake sales. Philidor has since announced plans to shut down.
Activist investor Bill Ackman said in a conference call that Valeant is undervalued and that he doesn't believe the business model is broken. Ackman is a major stockholder in the company.