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- Young Elvis impersonator from Bernie performs on 'Ellen DeGeneres Show' (1/12/17)
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- Imo's Pizza will be added to Rhodes 101 convenience store in Jackson (1/10/17)16
- Wallingford proposes bill to collect sales taxes on online purchases (1/11/17)30
Stocks fall on weaker outlooks and tension in Middle East
AP Business WriterNEW YORK (AP) -- Weaker outlooks for IBM, Bristol-Myers and Best Buy raised Wall Street's skepticism about a business recovery Tuesday and sent stock prices falling. The beleaguered technology sector endured the sharpest decline, with the Nasdaq composite index sliding 3.1 percent to its lowest close in a month.
A drop in U.S. factory orders and rising tensions in the Middle East gave investors more incentive to sell.
"This is definitely a period of time when investors might want to stay on the sidelines. And, based on the low (trading) volume we have been seeing, that is exactly what some investors are doing," said Arthur Hogan, chief market analyst at Jefferies & Co.
The Dow Jones industrial average closed down 48.99, or 0.5 percent, at 10,313.71, according to preliminary calculations. Tuesday marked the Dow's third consecutive losing session.
The broader market experienced a steeper decline. The Nasdaq fell 58.21, or 3.1 percent, to 1,804.41. The last time the Nasdaq finished lower was March 1, which it closed at 1,802.74.
The Standard & Poor's 500 index decreased 9.77, or 0.9 percent, to 1,136.77.
Investors are also anxious about first-quarter earnings, which companies begin releasing in earnest this month. While the market doesn't expect stellar results, it is at least looking for proof that business has improved and is strengthening.
Technology, the last sector most analysts expect to emerge from the recession, suffered the bulk of Tuesday's selling. IBM fell $1.85 to $101.01 after Goldman Sachs cut its first-quarter revenue estimate, saying in a research note that IBM's first quarter "got off to a slow start."
"Techs aren't showing the earnings bounce investors were looking for. This coupled with higher energy prices and further concern about conflict in the Middle East hasn't given Wall Street a lot to smile about today," said Thomas F. Lydon Jr., president of Global Trends Investments in Newport Beach, Calif.
Other tech losers included Microsoft, down $2.93 at $57.45, and Intel, off $1.14 at $30.03.
Among blue chips, Bristol-Myers fell $2.16 to $38.24 the day after it forecast that revenue will slump this year because wholesalers loaded up on its drugs in 2001.
Best Buy dropped $4.47 to $75.01 on a disappointing outlook for the fiscal first quarter when it expects to earn about 30 cents to 32 cents a share. Analysts were expecting 34 cents. Best Buy posted fourth-quarter results Tuesday that were a penny a share higher than Wall Street had anticipated.
Tuesday's slump was also due in part to a Commerce Department report that said orders to U.S. factories declined by 0.1 percent in February amid slumping demand for computers and cars.
And the market was again troubled by tension rising between Israelis and Palestinians.
"The swaying grand piano over the market's head for now is the threat of a blowup in the Middle East," said Richard A. Dickson, a technical analyst from Hilliard Lyons in Louisville, Ky., in a research note. Dickson added that the market is also concerned about rumblings from Iran and Iraq about an oil embargo, which "could create a slippery slope for any near-term rally attempts."
Investors have been selling stocks the past two weeks as uneasiness about earnings has resurfaced. Even the Dow industrials, considered havens during an uncertain economy, have been part of the pullback. The Dow is down 2.6 percent from its 2002 closing high of 10,635.25, made March 19.
There were some winners Tuesday, including Circuit City, which rose $1.03 to $19.15 after posting earnings that met analysts' expectations.
Declining issues were even with advancers on the New York Stock Exchange. Volume came to 880.09 million shares, compared with 795.84 million traded at the same point Monday.
The Russell 2000 index, the barometer of smaller company stocks, fell 4.01, or 0.8 percent, to 500.49.
Overseas, Japan's Nikkei stock average finished up 1.6 percent. In Europe, Germany's DAX index fell 1.6 percent, France's CAC-40 lost 1.3 percent, and Britain's FT-SE 100 declined 0.4 percent.
On the Net:
New York Stock Exchange: http://www.nyse.com
Nasdaq Stock Market: http://www.nasdaq.com