| Weak Earnings Ignite A Big Selloff On Wall Street |
| Oct-23-2012 |
| Keywords: stocks, earnings, selloff, gold, crude, dollar, treasuries |
The mood on Wall Street turned decidedly negative following another round of weak quarterly reports, and lowered forecasts serve as caution signs of a slowing global economy ahead.
All three major U.S. stock indexes ended the day mired in red, both the Dow Jones Industrial Average and the S&P 500 down more than 1% on the day.
The Dow Jones Industrial Average turned in its worst single session performance in four months, falling 243-points. The Nasdaq Composite fell more than 26-points, closing below 3000 for the first time since August. And the S&P 500 finished the session down just about 21-points on the day.
Weak earnings and lowered forecasts from Dow components 3M, DuPont and United Technology combined to spark today's selloff.
DuPont proved to be the biggest loser on the blue chip index, falling 9% on its weaker than expected earnings of 44 cents a share, two cents shy of expectations. DuPont's sales of $7.4 billion also trailed estimates of $8.15 billion. DuPont said it expects to earn between $3.25 and $3.30 for the full year, far behind forecasts of $3.93.
3M's stock fell 4% after matching estimates with a third-quarter profit of $1.65 a share. However its sales of $7.5 billion came in short of the Street's forecast of $7.6 billion. The Dow component also cut its full-year outlook to a range of $6.27 to $6.35, well below its previous guidance.
United Technologies revealed quarterly earnings of $1.37 a share, better than the $1.18 Wall Street analysts were expecting. But as has become a common theme as of late, revenues of $15.04 billion came in sort of estimates. United Technologies finished down about 1% on the day.
Meanwhile UPS gained 3% on adjusted third-quarter profit of $1.06 a share came in line with estimates. UPS's sales came in at $13.07 billion, missing forecasts of $13.31 billion as the company saw a decline in its overseas operations. Saving the company's stock today, UPS updated its full-year guidance to a range of $4.55 to $4.65 a share, compared to estimates of $4.56 a share.
Also on the corporate front, technology behemoth Apple fell 3% after logging its best single session performance in almost five months. Apple today unveiled its answer to smaller sized tablets from Amazon and Google. Apple today unveiled its iPad mini, which starts at $329. The new mini weighs less than .7lbs, and has a screen size of 7.9".
The sharp selloff in equities drove investors into the relative safety of the dollar and debt. The yield on the government's benchmark 10-year Treasury note slipping to 1.76%
Dollar strength and concerns over a slowing global economy exacting a big toll on commodity prices. Gold prices fell 1%, ending at a 7-week low of $1,709.40 an ounce.
Crude oil prices fell $1.98 or 2.2%, settling at a more than 3-month low under $87 a barrel.
Things remained interesting in after hours trading. Facebook building on its regular session gains in overnight trading. The social media company's stock moving higher after it topped quarterly targets and reported a 36% percent surge in quarterly ad sales.
The news, however, not nearly as good for Netflix. The online streaming company did manage to exceed quarterly earnings and revenue targets, but its disappointing outlook on subscribers led to a double-digit decline in overnight trading. |
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Posted by Lou Dobbs Staff at 1:00 PM Email to a friend |
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