Stocks slump before foggy earnings season begins

U.S. stocks slumped before the start of one of the most uncertain earnings seasons on record as the coronavirus pandemic rattles the global economy.

After its best week since 1974, the S&P 500 Index dropped -- with all of its major groups down on Monday. Oil fluctuated as investors weighed whether an unprecedented deal by the world's biggest producers to cut output could stabilize the market. Treasuries and the dollar slipped.

With the coronavirus pandemic sowing chaos across the world, the investment community has been lost in a fog when it comes to corporate profits. As the earnings season kicks off this week, traders might get a sense of how bad the hit to global earnings could be as the outbreak upends the global economy.

"Companies, analysts, traders, investors and strategists to some extent are 'flying into earnings season without instruments'," John Stoltzfus, the chief investment strategist at Oppenheimer & Co., wrote to clients. "The unprecedented nature of the economic shutdown, social distancing and sheltering in place ordered by officials provides an overhang of uncertainty."

Read: A Daredevil's Guide to a Very Wild Earnings Season

The S&P 500 is trading below the 2,800 level -- a major support line in 2019 that served as resistance the prior year. With one of foggy earnings season kicking off this week, there may be few catalysts to push stocks higher.

"We're in for a tough year," said Savita Subramanian, head of U.S. equity and quantitative strategy at Bank of America Corp. in a Bloomberg Television interview. Earnings are going to be down "by about 30%," she added.

In focus this week:

U.S. banks and financial firms begin reporting first-quarter earnings, led by JPMorgan, Citigroup, Bank of America, BlackRock, Goldman Sachs and Wells Fargo.

Bank Indonesia rate decision and briefing Tuesday

South Korea holds parliamentary elections and the Bank of Canada has a rate decision Wednesday

Also Wednesday, U.S. retail sales are poised to fall in March by the most ever seen

China releases GDP, industrial production and retail sales and jobless figures Friday

These are the main moves in markets:

Stocks

The S&P 500 decreased 1.7% to 2,742.32 as of 2:27 p.m. New York time.

The MSCI Asia Pacific Index fell 0.3%.

The MSCI Emerging Market Index declined 0.6%.

Currencies

The Bloomberg Dollar Spot Index dipped 0.2%.

The euro fell 0.1% to $1.0921.

The Japanese yen appreciated 0.8% to 107.56 per dollar.

Bonds

The yield on two-year Treasuries gained one basis point to 0.24%.

The yield on 10-year Treasuries climbed two basis points to 0.74%.

The yield on 30-year Treasuries increased three basis points to 1.38%.

Commodities

The Bloomberg Commodity Index decreased 0.1%.

West Texas Intermediate crude decreased 0.2% to $22.71 a barrel.

Gold increased 0.8% to $1,767.60 an ounce.