US stocks ended lower for the third straight session weighed down by disappointing earnings and outlooks from a handful of companies as commodities continued to fall.
The Dow Jones Industrial Average slipped 119.09 points or 0.7% to close at 17,731.2 points. The blue chip index is now negative for the year and trading well below its 200-day average.,
The S&P 500 Index fell by 12 points or 0.6% at 2,105.12 points with all 10 of its key sectors trading lower during the regular session. Utilities and materials were the biggest drags on the benchmark index slipping 1.5%.
The Nasdaq Composite reversed early morning gains to end 25.12 points or 0.5% lower at 5,146.41 points.
“Investors have been somewhat surprised at how unimpressive earnings have been considering where the stock market is,” Jeff Sica, who oversees over $1.5 billion as president and chief executive officer of Circle Squared Alternative Investments in Morristown, New Jersey, told Bloomberg.
“Earnings have not proven to be the catalyst they’ve looked for. Investors are just very tentative.”
Caterpillar Inc, the world’s biggest construction company, fell 3.6% to trade at $76.88 a share, their lowest share price in more than four years, after reporting a decline in sales in its major markets.
Caterpillar reported that its quarterly sales decline by a more than expected 13% for the three months ending June 31 knocking off more than 19 points off the Dow Jones and leading the broad industrials sector lower.
Also weighing tocks down were disappointing results manufacturer 3M Co and multinational financial services provider American Express.
American Express traded down 2.5% at $77 a share after its quarterly revenue missed expectations while manufacturer 3M Co was down 3.8% at $149.40 a share after tempering its sales outlook for the year.
“The initial take on big earnings reports has been lukewarm at best,” Bruce Zaro, chief technical strategist at Bolton Global Asset Management in Boston, told Reuters.
“The strong dollar certainly has been mentioned a lot, and I think there are still questions about demand in the economy and what would translate into revenue growth for most reporting companies.”
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