Earnings, China Worries Prompt Stock Selloff
New York – In late morning trading, the Dow Jones industrial average was down 208.25 at 9,569.68, compounding a 100-point loss Monday.
Broader stock indicators were also weak. The Standard & Poor's 500 index slid 24.70 to 1,121.17, and the Nasdaq composite index was off 79.06 at 1,703.91.
"It's the continued earnings surprises on the downside," said Matt Brown, head of equity management for Wilmington Trust. "What hurts even more is the outlook -- right now there's no visibility as to when this economy is going to turn around."
Technology and blue chip stocks fell for a second straight session Tuesday as investors braced themselves for first-quarter reports, which begin this week. Their anxiety has been heightened by another spate of earnings warnings.
Ariba slipped $1.19 to $5.25 in a loss that began late Monday after the business transaction software company reduced its quarterly outlook and said it will cut 700 jobs because of a drop-off in sales. BroadVision, another provider of e-commerce to business, also fell.
Technology losses helped pull the Dow lower, as well. IBM fell $2.61 to $92.05, while Hewlett-Packard lost $1.37 to $27.55.
Even Dow stocks usually popular with investors in uncertain economic times suffered. Philip Morris fell $1.39 to $44.80. American Express slipped 94 cents to $38.77, adding to losses Monday when it warned of weaker-than-expected first-quarter earnings.
Declining issues outnumbered advancers 5 to 2 on the New York Stock Exchange. Volume came to 374.15 million shares, compared with 298.96 million at the same point Monday.
The Russell 2000 index dropped 11.00 to 428.76.
Overseas, Japan's Nikkei stock average fell 1.4 percent. There were also losses in Europe. In afternoon trading, Germany's DAX index was off 2.9 percent, Britain's FT-SE 100 was down 2.1 percent, and France's CAC-40 slipped nearly 3.0 percent.