Wall Street slips as investors brace for French election

By Tanya Agrawal

REUTERS - Wall Street slipped in late morning trading on Friday as investors held off from making risky bets ahead of the first round of the closely contested French presidential election.

Centrist Emmanuel Macron is leading most opinion polls for Sunday's election and is expected to contest a second-round run-off with Marine Le Pen, head of the anti-European Union and anti-immigrant National Front.

"Although Macron has been labeled as favorite to become the next French President, an unexpected Marine Le Pen victory could deal a symbolic blow to the unity of the European Union and ultimately create a tidal wave of risk aversion," FXTM analyst Lukman Otunuga said in a note.

After a two-week losing streak, major indexes are on track to post weekly gains following Thursday's rally, which was driven by Treasury Secretary Steven Mnuchin's comments that the Trump administration would unveil a tax reform plan very soon.

A steady stream of strong earnings through the week continued to bolster market sentiment.

Of the 95 companies in the S&P 500 that have reported earnings through Friday morning, about 75 percent have topped expectations, according to Thomson Reuters data, above the 71 percent average for the past four quarters.

Overall, profits of S&P 500 companies are estimated to have risen 11.2 percent in the quarter, the best since 2011.

"The earning season has been tremendous so far and while we're still relatively early in the season, we're off to a great start," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

At 11:15 a.m. ET (1515 GMT) the Dow Jones Industrial Average was down 23.31 points, or 0.11 percent, at 20,555.4, the S&P 500 was down 6.41 points, or 0.27 percent, at 2,349.43 and the Nasdaq Composite was down 11.89 points, or 0.2 percent, at 5,904.88.

Seven of the 11 major S&P sectors were lower, with the telecommunications index's 0.89 percent fall leading the decliners.

Shares of General Electric fell 1.1 percent to $29.94 after the company reported negative cash flow from its industrial operations in the first quarter.

Schlumberger was down 3.1 percent at $74.17 after the oilfield services provider warned that margins would remain under pressure as it spends more to bring back idled equipment. The stock was the biggest drag on the S&P.

Mattel fell as much as 11.3 percent to an 18-month low of $22.35 after the toymaker reported a bigger-than-expected quarterly loss.

Oil prices edged lower, on course for the biggest weekly drop in a month, over doubts that an OPEC-led production cut will restore balance to an oversupplied market. [O/R]

Declining issues outnumbered advancers on the NYSE by 1,535 to 1,175. On the Nasdaq, 1,584 issues fell and 974 advanced.

The S&P 500 index showed 23 new 52-week highs and one new low, while the Nasdaq recorded 53 new highs and 16 new lows.

(Reporting by Tanya Agrawal; Editing by Anil D'Silva)