By Wallace Witkowski and Anora Mahmudova, MarketWatch
Whirlpool tanks after earnings miss Wall Street's estimates
U.S. stocks declined, but traded off their lows of the session
Tuesday, as investors grappled with a wave of lackluster corporate
earnings and waning confidence, against a backdrop of the U.S.
presidential election and growing expectation of a rate increase by
the Federal Reserve.
The confidence of Americans
(http://www.marketwatch.com/story/consumer-confidence-droops-ahead-of-presidential-election-2016-10-25)in
the U.S. economy fell in October to a three-month low just ahead of
the race for the White House between Democratic candidate Hillary
Clinton and GOP nominee Donald Trump, with more consumers saying
jobs are harder to find.
The main benchmarks were giving up most of the previous
session's gains. The S&P 500 declined by 5 points, or 0.3%, to
2,144, after being down nearly 10 points earlier. Nine of the 11
main sectors were trading lower. Consumer discretionary and
materials led the decliners, down 1.1%.
The Dow Jones Industrial Average declined 45 points, or 0.3%, to
18,177, as shares of 3M Co.(MMM) weighing on blue-chips with a 3%
decline. Earlier, the average had been down as many as 71
points.
3M reported earnings that beat Wall Street expectations but the
St. Paul, Minn.-based company posted sales that were flat relative
to the prior year and reduced the top end of its yearly earnings
forecast
(http://www.marketwatch.com/story/3m-cuts-earnings-outlook-amid-flat-sales-2016-10-25-84852553).
The Nasdaq Composite Index was off by 19 points, or 0.4%, at
5,291, coming off a 30-point deficit earlier in the session.
Tuesday's retreat in stocks was to be expected as Monday's gains
were primarily the result of merger enthusiasm
(http://www.marketwatch.com/story/merger-monday-sets-us-stocks-on-track-for-gains-2016-10-24),
said Karyn Cavanaugh, senior market strategist at Voya
Financial.
"Deals tend to boost investor confidence especially after a dry
spell," Cavanaugh said. "So, we were just setting ourselves up for
a bit of a letdown."
Market participants have been wrestling with third-quarter
earnings that have outperformed lowered expectations, but a number
of companies have cut their annual outlooks, which has raised
questions about future earnings.
Cavanaugh said the market is still focused on earnings and with
about 30% of the S&P 500 having reported, chances are good that
third-quarter earnings could end more than a year of quarterly
earnings declines.
Investors are eager to find out the results from two of the tech
giants this week, with Apple reporting after the closing bell on
Tuesday.
Analysts expect to see Apple Inc.(AAPL) report earnings at the
high-end of its fourth-quarter forecast
(http://www.marketwatch.com/story/apple-sales-likely-to-fall-again-despite-samsung-woes-2016-10-24),
aided by the iPhone 7 launch and new customers switching from
Android after Samsung Electronics' exploding Note 7 troubles.
However, analysts are also projecting the third-straight quarterly
decline in iPhone unit sales.
Alphabet Inc. (GOOGL)(GOOGL), Google's parent company, is set to
report Thursday.
Economic data:Consumer confidence dropped to 98.6 this month
from 103.5
(http://www.marketwatch.com/story/consumer-confidence-droops-ahead-of-presidential-election-2016-10-25)
in September, a number that was cut, the privately run Conference
Board said Tuesday. The decline was well below Wall Street
expectations.
Separately, U.S. home prices rose in August, and were up 5.1%
year-over-year as tight inventories continued to drive prices
higher, according to the S&P CoreLogic Case-Shiller 20-City
index.
Corporates: Shares in Whirlpool(WHR) dropped 12% after the
appliance maker reported third-quarter profit and sales that missed
expectations
(http://www.marketwatch.com/story/whirlpool-slumps-43-premarket-after-profit-miss-2016-10-25),
and issued a downbeat outlook.
Merck & Co. shares (MRK) rose 1.7% after the drugmaker's
third-quarter earnings and sales came in above expectations
(http://www.marketwatch.com/story/merck-shares-climb-3-after-third-quarter-earnings-beat-2016-10-25).
Chemicals maker DuPont& Co. (DD) shares fell 1% despite the
company raising its yearly profit forecast and better-than-expected
quarterly earnings
(http://www.marketwatch.com/story/dupont-lifts-yearly-profit-view-as-sales-increase-2016-10-25).
The company is working on its merger with Dow Chemical Co.
(DOW).
Watch:Do lawsuits drive innovation in chemical industry?
Procter & Gamble Co.(PG) gained 4.1% after the consumer
goods company reported earnings ahead of forecasts
(http://www.marketwatch.com/story/procter-gamble-shares-rise-after-earnings-beat-2016-10-25).
Lockheed Martin Corp.(LMT) shares jumped 7.1% after the
aerospace company posted higher-than-expected revenue
(http://www.marketwatch.com/story/lockheed-martin-lifts-outlook-as-revenue-beats-2016-10-25)and
hiked its dividend.
Baker Hughes Inc.(BHI) shares rallied 4.8% after the oil-field
services company reported a narrower-than-expected loss
(http://www.marketwatch.com/story/baker-hughes-shares-soar-loss-smaller-than-feared-2016-10-25).
General Motors Co. (GM) shares fell 3.7% even as auto giant's
quarterly profit doubled
(http://www.marketwatch.com/story/general-motors-earnings-more-than-double-2016-10-25-74853840).
GM also posted higher revenue on strong U.S. truck sales. But it
signaled continued weakness in Europe because of the fallout from
the U.K.'s pending exit from the European Union, or Brexit.
Freeport-McMoRan Inc. (FCX) rallied 3.5% despite reporting
profit and revenue
(http://www.marketwatch.com/story/freeport-mcmoran-misses-earnings-and-revenue-expectations-2016-10-25)
that missed analysts' expectations on Tuesday.
Under Armour Inc.'s(UA) shares plunged 13% after the company
issued a profit warning
(http://www.marketwatch.com/story/under-armours-stock-rocked-after-downbeat-outlook-2016-10-25).
The decline came even as the athletic gear maker reported a 28%
rise in third-quarter profit and an expansion of its market share,
but those results were overshadowed by its warning.
Nielsen Holdings PLC(NLSN) shares dropped more than 14% after
the media-ratings company reported a slip in profit because of
higher restructuring charges
(http://www.marketwatch.com/story/nielsen-profit-falls-on-restructuring-costs-2016-10-25).
Other markets: Oil futures dropped more than 1%
(http://www.marketwatch.com/story/oil-prices-drift-south-as-upcoming-opec-meeting-starts-to-look-like-a-bust-2016-10-25)
while gold futures
(http://www.marketwatch.com/story/gold-steadies-as-dollars-advance-pauses-at-8-month-high-2016-10-25)settled
up 0.8% at $1,273.60 an ounce. The ICE U.S. Dollar Index tilted
lower after an earlier gain
(http://www.marketwatch.com/story/dollar-holds-strength-in-wake-of-upbeat-session-for-us-stocks-2016-10-25).
European stocks
(http://www.marketwatch.com/story/european-stocks-gain-as-german-business-mood-rises-to-25-year-high-2016-10-25)
pared earlier gains and were mostly lower and Asian shares
(http://www.marketwatch.com/story/asian-markets-mixed-after-report-of-korean-economic-slowdown-2016-10-24)
were mixed following data that pointed to a slowdown for South
Korea's economy.
--Carla Mozee in London contributed to this article.
(END) Dow Jones Newswires
October 25, 2016 14:42 ET (18:42 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.