However, it wasn't all bad, despite the pullback. AT&T (T - Get Report) was better than expected on the profit line, as were Lockheed Martin (LMT) and CME (CME). While AT&T and CME declined, Lockheed Martin shot higher by 3.6% to $103.09.
Pepsi (PEP), EMC (EMC - Get Report) and McGraw-Hill (MHP) were also better than expected, as were UAL (UAUA) and Northrop Grumman (NOC). UAL was the only name in the group to finish with gains, ending higher by 4.2% for the session.
Dow stock McDonald's (MCD) posted only its second-ever quarterly loss. Excluding items, the restaurant chain matched the forecast for a profit of 71 cents a share. Shares slipped 95 cents, or 1.8%, to finish at $51.55.On the research front, Citigroup upgraded Wachovia (WB) to buy from hold, citing valuation. Still, shares closed lower by 41 cents, or 0.8%, to $48.41. Among downgrades, Jefferies cut both United Rentals (URI) and GlobalSantaFe (GSF) to hold from buy. United Rentals was off by 56 cents, or 1.7%, to $32.42. GlobalSantaFe ended down 73 cents, or 0.9%, to $77.60. On Monday, both stocks made M&A headlines and gave the major averages a boost. Transocean (RIG) said it will combine with GlobalSantaFe to form a driller with an enterprise value of $53 billion.