Wall Street lower as earnings in focus, media stocks slump

By Tanya Agrawal

REUTERS - Wall Street fell on Thursday morning as investors traded on earnings, with Walt Disney's warning on its cable business continuing to haunt media stocks.

Walt Disney's shares fell 2.9 percent to $107.33, a day after their largest daily drop in almost seven years. The stock was also the biggest drag on the Dow and the S&P 500.

Twenty-First Century Fox fell 7.7 percent. Time Warner, Discovery Communications and CBS were all in the red.

In other earnings-driven stock moves, Tesla and Keurig Green Mountain skidded after reporting disappointing numbers.

Investors are also awaiting Friday's jobs data that may offer clues on the timing of an interest rate increase.

U.S. economic data released in the last few days have been largely mixed, prompting some investors to argue that the Fed might hold off rate hikes until December.

The Fed has said it will raise rates only when it sees a sustained recovery in the economy. A hike in rates, which have stayed near zero for nearly a decade, will increase borrowing costs for companies, crimping profits.

"I've been leaning towards September because while the data has been mixed, none of it has been really bad," said Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas.

"I think a hike is good for the market because we can finally stop worrying about it, and historically the Fed has always been slow regarding subsequent increases."

Data released on Thursday showed that the number of Americans filing new applications for unemployment benefits rose less than expected last week, indicating tighter labor market conditions.

At 9:53 a.m. ET (1353 GMT) the Dow Jones industrial average was down 69.58 points, or 0.4 percent, at 17,470.89, the S&P 500 was down 4.99 points, or 0.24 percent, at 2,094.85 and the Nasdaq Composite was down 16.67 points, or 0.32 percent, at 5,123.27.

Nine of the 10 major S&P sectors were lower with the energy index's 1 percent fall leading the decliners. The financial index was the lone advancer.

Marathon Oil, Monster Beverage and Zynga are among the companies scheduled to report after the close of market.

With about three-quarters of the S&P 500 companies having reported, second-quarter earnings are estimated to have increased 1.3 percent while revenues are projected to have fallen 3.5 percent.

Mondelez International shares rose 1.9 percent to $47.16 after billionaire activist investor William Ackman's hedge fund said it has built a stake worth about $5.5 billion in the Cadbury chocolate and Oreo cookies maker.

Michael Kors Holdings rose 8.7 percent to $42.93 after its results beat expectations.

Tesla Motors fell 8.9 percent to $245.90 after the electric car maker posted a wider quarterly loss

Keurig Green Mountain slumped as much as 30.1 percent to a two-year low of $52.40, a day after the company lowered its annual sales and earnings-per-share forecasts.

Fitbit fell 8.4 percent to $47.4 after the wearable fitness tracking devices maker said margins fell in the second quarter.

Declining issues outnumbered advancing ones on the NYSE by 1,690 to 1,043. On the Nasdaq, 1,311 issues fell and 1,029 advanced.

The S&P 500 index showed 14 new 52-week highs and 37 new lows, while the Nasdaq recorded 36 new highs and 78 new lows.

(Reporting by Tanya Agrawal; Editing by Saumyadeb Chakrabarty)