* U.S. shares fall, led by consumer staples and healthcare
* European shares muted by drop in telecoms
* Oil prices steady after touching multi-month highs
* U.S. Treasury yields rise after U.S. manufacturing data
* Sterling slumps as PM May fires Brexit starting gun
(Updates to open of U.S. trading; changes byline, dateline, pvs
By Sam Forgione
NEW YORK, Oct 3 U.S. shares slipped on Monday on
weakness in healthcare and consumer stocks, while a drop in
European telecommunications shares kept stocks subdued in the
region and oil prices eased from multi-month highs on doubts
over the effectiveness of an OPEC deal to cut output.
Pfizer dragged down the S&P 500 healthcare index
, while the consumer staples sector fell with
losses in Procter & Gamble and PepsiCo weighing.
"Consumer staples have done tremendously well this year,"
said Richard Sichel, chief investment officer at Philadelphia
Trust Co. "On a price-to-earnings basis, they're not looking
The European telecoms sector dropped on weakness in British
phone group BT Group's shares after the Financial Times
reported that talks with UK phone regulator Ofcom over a deal to
transform BT's fixed-line network Openreach into a legally
separate entity have reached a dead end.
Investors were also on the lookout for news from Deutsche
Bank, which is working to reach a settlement with U.S.
authorities who have demanded a fine of up to $14 billion for
mis-selling mortgage-backed securities. Its U.S.-listed shares
were last down 1.9 percent.
Benchmark Brent crude oil prices steadied after touching a
six-week high of $50.90 a barrel, while U.S. crude prices eased
after touching a three-month high of $48.87 a barrel. Doubts
that OPEC's deal would wipe out a crude glut weighed on
MSCI's world equity index fell 0.31 points,
or 0.07 percent, to 418.12.
The Dow Jones industrial average was down 64.85
points, or 0.35 percent, at 18,243.3. The S&P 500 was
down 7.9 points, or 0.36 percent, at 2,160.37. The Nasdaq
Composite was down 12.36 points, or 0.23 percent, at
Europe's broad FTSEurofirst 300 index slipped 0.05
percent at 1,349.93.
Brent crude was last up 8 cents, or 0.16 percent, at
$50.27 a barrel. U.S. crude was last down 1 cent, or 0.02
percent, at $48.23 per barrel.
Sterling fell around 1 percent against the dollar to a
three-month low of $1.2818 and slightly above a 31-year
low of $1.2796 after Britain on Sunday set a March deadline to
start the process to leave the European Union. It also hit a
three-year low against the euro of 87.47 pence per euro
The dollar index, which measures the greenback against a
basket of six major currencies, gained on data showing the U.S.
manufacturing sector grew by more than expected in September.
The index was last up 0.29 percent.
The manufacturing data boosted expectations that the Federal
Reserve would raise interest rates by December, sending U.S.
Treasury yields higher. Traders also awaited Friday's U.S.
September jobs report.
Benchmark 10-year U.S. Treasury yields hit a
more than one-week high of 1.6260 percent, while two-year yields
hit a 12-day high of 0.7980 percent.
"If the week stays like this then December might get more
priced in," said Gennadiy Goldberg, interest rate strategist at
TD Securities in New York.
Spot gold prices fell $4.20, or 0.32 percent, to
$1,311.60 an ounce.
(Additional reporting by Richard Leong and Karen Brettell in
New York; Editing by Meredith Mazzilli)