U.S. stocks headed modestly lower Friday as retreat in oil prices weighed on energy shares ahead of the key meeting of major oil producers slated for Sunday.
However, better-than-feared corporate earnings helped limit the decline for the benchmarks.
The Dow Jones Industrial Average was down 30 points, or 0.2%, at 17,896, while the S&P 500 fell 4 points, or 0.2%, to 2,078. The Nasdaq Composite was down 14 points, or 0.3%, at 4,934.
Despite their tepid daily performance, the Dow and S&P 500 were on track for their third straight weekly gain.
Crude-oil prices tumbled after reports Iran's oil minister Bijan Zanganeh won't attend a meeting of key oil producers in Doha, Qatar this weekend but instead will send a less prominent representative. Optimism about a possible multilateral agreement, which had supported prices earlier in the week, disintegrated on the news, leaving oil prices to unwind a significant portion of their prior weekly gains.
Stock market benchmarks were slightly lower on the day.
The blue-chip average has risen nearly 2% so far this week, and is on track to log its strongest weekly performance since March 18. Microsoft Corp.(MSFT) was the blue-chip benchmark's best performer, while Cisco Systems Inc.(CSCO) logged the largest drop.
Kate Warne, an investment strategist at Edward Jones, cautioned against taking Friday's losses too seriously, saying next week's earnings reports and the outcome of the Doha meeting would likely determine the future tone of markets.
"This is really a wait-and-see market rather than one where investors have a clear sense of the direction going forward," Warne said.
Meanwhile, a report early Friday from Citigroup Inc. (C)showed revenue and profit declines weren't as severe as expected, (http://www.marketwatch.com/story/why-the-worst-earnings-quarter-since-2009-may-be-a-good-thing-2016-04-09) adding to hopes that the first quarter corporate earnings season might be better than expected.
Investors had braced for possibly the worst earnings quarter since 2009, (http://www.marketwatch.com/story/why-the-worst-earnings-quarter-since-2009-may-be-a-good-thing-2016-04-09) but so far, companies have broadly outperformed lowered expectations. Worries about poor financial-sector performance were particularly acute, but several of the country's largest banks--including Citigroup, J.P. Morgan Chase & Co.(JPM) and Wells Fargo & Co.--have done better than expected.
Oliver Pursche, chief executive officer at Bruderman Brothers, said he felt the positive corporate reports were drawing investors' attention away from Friday's drop in oil prices.
"While it's very early in the season, there's been some positive surprises," Pursche said. "Granted, the bar is very low this quarter--but it's always about expectations versus reality."
Pursche cited the recent weakness in the U.S. dollar as a key factor helping to support stocks and boost expectations for corporate performance.
The S&P 500 index and Dow industrials notched new 2016 highs on Thursday (http://www.marketwatch.com/story/us-stocks-point-south-as-oil-dips-bank-of-america-results-ahead-2016-04-14), though gains were modest.
Read:From Japan to Goldilocks, 6 inflation/deflation scenarios for stocks (http://www.marketwatch.com/story/from-japan-to-goldilocks-6-inflationdeflation-scenarios-for-stocks-2016-04-14)
Doha casts a shadow: Oil prices may influence stock action as crude futures fell into the red on reports (http://www.marketwatch.com/story/oil-slides-after-report-confirms-iran-oil-minister-will-skip-doha-2016-04-15) Iran won't send its energy minister to the Doha meeting on Sunday. The report said Iran's Organization of the Petroleum Exporting Countries governor will still attend the summit, which is expected to discuss a production freeze to balance the oil market.
U.S. crude prices (http://www.marketwatch.com/story/oil-slides-after-report-confirms-iran-oil-minister-will-skip-doha-2016-04-15) lost 94 cents, or 2.3%, to $40.57 a barrel, while Brent oil dropped 61 cents, or 1.4%, to $43.22 a barrel.
Iran has rejected calls for an output freeze, which would complicate its desire to return to pre-sanction levels before reining in production. But the world's largest oil producer, Saudi Arabia, had previously indicated that it won't agree to a Doha deal unless Iran signs.
Read: 'Confusion reins supreme' ahead of Doha oil freeze meeting (http://www.marketwatch.com/story/what-to-expect-as-key-meeting-on-oil-output-freeze-looms-2016-04-14)
Read: This nasty oil rivalry is why a genuine output freeze is a long shot (http://www.marketwatch.com/story/this-nasty-oil-rivalry-is-why-a-genuine-output-freeze-is-a-long-shot-2016-04-14)
"Our expectations for the meeting are low. Although an agreement on production caps is likely to be reached, it will probably not include any concrete figures or obligations, let alone any sanctions to be imposed in the event of noncompliance," said analysts at Commerzbank in a note to clients Friday.
Data and a Fed speaker: China reported first-quarter gross domestic product growth of 6.7%, still marking a slower rate of growth for the world's No. 2 economy but coming in right in line with expectations. The data were viewed as a sign the country's stimulus efforts are starting to work.
The Empire State index for April jumped to its highest level in more than a year, (http://www.marketwatch.com/story/empire-state-index-jumps-to-highest-level-in-more-than-a-year-in-april-2016-04-15) a sign that business conditions in the New York Fed's district have improved markedly.
Industrial output declined in March for the sixth time in the past seven months, falling 0.3%, stoking worries about weakness in the U.S. manufacturing sector.
Chicago Fed President Charles Evans said investors should expect only modest increases in interest rates this year during a J.P. Morgan Investor Seminar in Washington.
Speaking in Washington on Friday, European Central Bank President Mario Draghi said the outlook for growth and inflation in the eurozone remains uncertainty and pledged that the central bank would do whatever it could to support growth.
A preliminary reading on consumer sentiment fell 89.7 (http://www.marketwatch.com/story/consumer-sentiment-weakens-in-initial-april-reading-university-of-michigan-says-2016-04-15) in early April, a University of Michigan report said.
Weekly data from Baker Hughes showed a very modest drop in the U.S. oil-rig count.
Stocks to watch: BATS Global Markets Inc.(BATS) began trading $22.88 a share (http://www.marketwatch.com/story/bats-global-markets-prices-ipo-at-top-of-the-range-2016-04-14) in what was seen as a hotly anticipated debut amid a dearth of such offerings so far this year.
Charles Schwab Corp.(SCHW) shares rose after revenue beat expectations. (http://www.marketwatch.com/story/charles-schwabs-stock-gains-after-revenue-rises-above-expectations-2016-04-15)
Valeant Pharmaceuticals International Inc. (VRX.T) shares rose after a report Thursday that the company may sell off part of its business. (http://www.marketwatch.com/story/valeant-shares-tick-higher-on-report-of-possible-divestitures-2016-04-14)
Ixia (XXIA) fell after the network security testing company said it would fall short of its forecasts for the first quarter. (http://www.marketwatch.com/story/ixia-shares-fall-after-outlook-cut-2016-04-14)
Other markets: European stocks joined Asia stocks in finishing mostly lower on Friday. The Shanghai Composite Index eased 0.1%, showing little reaction to China's GDP data.
Gold prices moved higher, while the dollar (http://www.marketwatch.com/story/dollar-inches-up-as-investors-wait-for-word-from-g-20-meeting-2016-04-15) weakened slightly against its main rivals as investors waited for Group of 20 central bankers and finance ministers to wrap up their two-day meeting.
By Joseph Adinolfi and Barbara Kollmeyer, MarketWatch