NEW YORK: Wall Street stocks dropped modestly on Tuesday (Oct 25) as investors adopted a cautious view after a deluge of earnings results that included both positive and negative surprises.
“We’re seeing an overall positive tone to earnings but we have seen some … potential signs of caution, so investors are waiting to gather the complete picture,” said David Levy, portfolio manager at Republic Wealth Advisors.
Big winners included the defence giant Lockheed Martin, up 7.5 per cent, and consumer products giant Procter & Gamble, which gained 3.4 per cent after reporting strong gains in organic sales.
On the flip side, shares of paint company Sherwin-Williams and home-appliance make Whirlpool suffered double-digit percentage declines after disappointing results. That prompted concerns that consumer investment in homes is slowing, pushing shares of Home Depot and Lowe’s down more than three per cent.
The Dow Jones Industrial Average dropped 53.76 points (0.30 per cent) to 18,169.27.
The broad-based S&P 500 shed 8.17 points (0.38 per cent) to 2,143.16, while the tech-rich Nasdaq Composite Index lost 26.43 points (0.50 per cent) to 5,283.40.
Caterpillar finished down 1.8 following a volatile session after reporting that third-quarter net profits sank nearly 50 per cent year-on-year to US$283 million. The heavy equipment maker said it was encouraged that commodities prices have risen somewhat, but that it had yet to see a pickup in business.
Traders work on the floor of the New York Stock Exchange. (AP Photo/Richard Drew)
General Motors dropped 4.3 per cent after reporting that net profit in the third quarter roughly doubled to a better-than-expected US$2.8 billion due largely to lower costs on recalls compared with the year-ago. The automaker warned that its goal of breaking even in Europe could be stymied by fallout from Britain’s vote to pull out of the European Union.
Athletic shoe and apparel maker Under Armour slumped 13.1 per cent after it warned that it would miss its 2018 operating profit target due to higher expenses as it expands into new markets.