LONDON (ShareCast) - (ShareCast News) - US equities slid early on Monday, as the Empire State Index nosedived to its worst level since the start of the recession.
Just after 1500 BST, the Dow Jones Industrial Average was down 112 points to 17,364.96, while the S&P 500 and the Nasdaq were 11 and 27 points lower respectively.

Monday data

According to the New York Federal Reserve, the Empire State general business conditions index plummeted to -14.9 from 3.9 in July, way below analysts' expectations for a 4.5 reading and to its lowest level since the recession.

The new-orders sub-index nosedived to -15.7 from -3.5, while the shipments index tumbled to -13.8 from 7.9.

"A drop as big as this does suggest that the dollar's appreciation and/or the slowdown in global economic growth is having a more marked impact on the manufacturing sector than previously thought," said Paul Ashworth, chief US economist at Capital Economics.

However, Ashworth went on to add that regional manufacturing surveys are notoriously volatile and, therefore, it would be somewhat premature to read too much into Monday's data.

"We would be cautious about reading too much into this collapse until it is verified by a corresponding decline in either the Philly Fed index (due out on Thursday) or the Markit manufacturing PMI (due out on Friday)," he explained.

"As it stands now, this won't prevent a September rate lift-off."

Meanwhile, the National Association of Home Builders/Wells Fargo housing market index rose 1 point to 61, marking the highest level since November 2005 and climbing above expectations of a 59 reading.

Elsewhere, Asian stocks closed on a mixed note as China set the yuan in line with its Friday close, suggesting the government would allow market forces to move the currency. The Shanghai Composite climbed 0.72%, while Hong Kong's Hang Seng fell 0.73%.

European stocks edged higher, bouncing back from heavy losses last week sparked by the devaluation of the yuan, as investors kept an eye on developments in Greece.

The dollar was flat against the euro and the yen but rose 0.17% against the pound, while gold futures climbed 0.70% to $1,120.50.

Oil prices slid, with West Texas Intermediate losing 0.97% to $42.09 a barrel, while Brent was trading at $48.86 a barrel.

Wall Street heavyweights set to report

On the corporate front, he earnings season continues, with a number of Wall Street heavyweights set to report this week.

Clothing retailer Urban Outfitters is on tap after the close, while Target and Wal-Mart, which have big exposure to China, could benefit from the weaker yuan.

"US retailers including importers from China such as Wal-Mart, Target and Home Depot will dominate the earnings calendar this week," said CMC Markets' analyst Jasper Lawler.

"The weaker yuan is of benefit to US companies buying Chinese goods with a stronger dollar but they need a more confident consumer at home who is willing and able to buy the goods.

"US retail sales picked up in July but were pretty sluggish throughout the second quarter."

Among the companies that reported earlier on Monday, skincare and beauty products manufacturer Estee Lauder fell 1.70% after the group delivered a gloomy forecast, even though its profit beat expectations.

General Electric slid 0.96% after a Reuters report late on Friday claimed the firm was expected to win approval from European regulators to buy a power business from France's Alstom SA.

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