Stocks Slip On Mixed Earnings, Econ Reports
Stocks slipped Tuesday after earnings and economic reports came in mixed. Consumer products giant Procter & Gamble Co. and chemical maker Dow Chemical Co. both reported profit and revenue that fell short of forecasts. Those disappointments offset better-than-expected results from pharmaceutical company Pfizer Inc.
A report that showed personal income and spending was flat in June also tempered the market's mood. The Commerce Department said personal income and spending were both unchanged in June after rising 0.3 percent and 0.1 percent respectively in May. The readings were also short of forecasts for a 0.2 percent gain in income and 0.1 percent growth in spending predicted by economists polled by Thomson Reuters.
The Dow Jones industrial average fell 27 points in early morning trading. Broader indexes were also moderately lower.
The weak numbers follow a trend of economic reports that point to a slowdown in economic growth. Reports are due out later in the day on factory orders and pending home sales that are expected to also provide additional evidence of a mixed economy.
The economic and earnings reports took some luster off a market that rallied sharply Monday in the first day of trading in August. The Dow Jones industrial average jumped 208 points Monday after a report on July manufacturing showed growth in the sector slowed modestly, but not as fast as economists had expected. It was the best start to August trading since 1934.
Earnings had largely topped forecasts in the past few weeks and companies were mostly upbeat about future growth. However, Tuesday's results provided a rare slice of disappointment with two major companies falling short of analysts' predictions.
Stocks fell immediately at the open after the earnings reports followed a similar pattern that has been seen throughout the past couple of months. Trading has been erratic as investors receive conflicting signs about the pace of recovery. That has led to sharp swings higher and lower as investors focus on the latest piece of news to try and determine if or when the recovery will accelerate.
In early morning trading, the Dow Jones industrial average fell 26.95, or 0.3 percent, to 10,647.43. The Standard & Poor's 500 index fell 4.32, or 0.4 percent, to 1,121.54, while the Nasdaq composite index fell 8.90, or 0.4 percent, to 2,286.46.
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