Earnings worries triggered by a number of warnings after yesterday's close and a morning downgrade on
Great Atlantic Pacific & Tea Group
, better known as A&P, were pressuring stocks this morning.
Dow Jones Industrial Average was 52 lower to 11,207.
Nasdaq Composite Index was down 110 to 3988, falling below the psychologically important 4000 level.
, which was rising in preopen action on news it had entered a deal with tech leader
, was the most active stock on the Nasdaq. BroadVision was lately down 4% to $36.38.
Wall Street is particularly worried now about slowing corporate earnings growth. The last few months of economic data have generally shown a slowing economy, and the season of earnings warning is fast approaching. Companies expecting to miss earnings estimates tend to warn right before quarterly earnings are released, or beginning in early October.
Investors may be afraid that rising crude oil prices will continue to bite into corporate profits, particularly after chemical bellwether
partly blamed oil costs for the profits warning it issued yesterday morning.
"This weakness is part of the soft landing -- worries over corporate earnings. But I've never seen in my young forty years a soft landing work," said Doug Myers, vice president of equity trading at
The other major indices were also deep in the red, with the broad market
S&P 500 off 11 to 1491 and the small-cap Russell 2000 off 5 to 538.
TheStreet.com Internet Sector
index was 27 lower to 811.
Retail stocks were one of the few sectors getting a lift this morning, after
Morgan Stanley Dean Witter
upgraded several clothing retailers, including
Abercrombie & Fitch
. TJX was 4.7% higher, Limited was up 3.8% and Abercrombie was up 3.7%. The
S&P Retail Index
was up 2.2%.
Commodity-related indices were having a hard time today, as the
Philadelphia Stock Exchange Oil Service Index
was down 2.9% and the
Amex Oil & Gas Index
dropped 1.8%. The
Philadelphia Stock Exchange Forest & Paper Products Index
Back to top
The 10-year Treasury note has been relatively volatile this morning, lately up 4/32 at 100 3/32, and yielding 5.737%. Treasuries fell for the third session in a row yesterday as investors reacted to rising oil prices and the upcoming heavy issuance of corporate bonds.
Back to top