NEW YORK (TheStreet) -- U.S. stocks were losing ground on mixed corporate reports and a disappointing adjustment to third-quarter U.S. gross domestic product growth data.
Dow Jones Industrial Average
was down 30.6 points, or 0.2%, at 11,516. The
was shedding 1.4 points, or 0.1%, at 1191, and the
was falling 2.8 points, or 0.1%, at 2,520.
The Bureau of Economic Analysis said its second estimate of U.S. third-quarter gross domestic product growth came in at 2%, down from the prior estimate of 2.5% growth. A poll of economists by
expected a 2.5% annualized growth rate.
"The shortcut to understanding the downward revision is that consumption was slightly weaker than initially estimated, while investment patterns acted as a drag to the economy," Miller Tabak chief economic strategist Andrew Wilkinson said in a note. "The big drag apparent in the revision is from a weakening in inventories as companies pared investment in the face of slacker external demand. The desire to remain lean and nimble came at a time when exporters faced the growing probability of weakening external demand in the shape of the sovereign debt crisis."
Lou Brien, a market strategist at DRW Trading, continues to focus on the daily technical movements of the S&P 500, paying particular attention to Monday's low at slightly more than 1183. He says the index's 50% decline to its early October low is just a fraction of a point above that Monday low. "For today, it will be of great interest to see if this level trades once again and to see if this holds or if it is broken; if the latter is the case it could bring in more selling."
Rating agencies Standard & Poor's and Moody's reaffirmed their views on U.S. creditworthiness despite the failure of the congressional "super committee" to reach a debt reduction deal.
S&P maintains its AA+ rating for U.S. long-term debt with negative outlook, after downgrading the country from the pristine AAA rating on Aug. 5, and Moody's said its AAA rating with a negative outlook remains unchanged. Fitch Ratings will finalize its U.S. credit rating review by the end of this month.
This, despite the failure of a special congressional committee to reach an agreement to reduce the U.S. deficit by $1.2 trillion over a decade. This will likely trigger automatic spending cuts beginning in 2013 split evenly between defense and domestic spending.
In describing Washington and the deficit, T. Rowe Price chairman and chief investment officer Brian Rogers says "there's a lack of foresight, there's a lack of responsibility ... and also a lack of courage."
Jeffrey Sica, head of Morristown, N.J.-based Sica Wealth Management,
"As long as they keep raising the debt ceiling, if they don't get GDP numbers that consistently exceed expectations, there's no relevance," Sica said. "You would need to see astronomical growth in GDP."
Minutes of the Federal Open Market Committee's meeting on Nov. 2 on the benchmark interest rate will be released at 2 p.m. The markets will parse the minutes for signs of discussions on more quantitative easing.
The Dow's biggest decliners were
Bank of America
( KFT) and
were leading gains.
Trading volume was light ahead of the Thanksgiving holiday weekend. About 1.4 billion shares changed hands on the New York Stock Exchange and about 727 million on the Nasdaq.
John Linehan, director of U.S. equities and co-portfolio manager of the U.S. large cap value strategy at T. Rowe Price, says the "recent selloff has created opportunities to buy high- quality companies at discount prices."
"The longer you look, the more attractive it looks," he added.
In corporate news,
Bank of America
shares were falling 2.5% following reports from
The Wall Street Journal
saying that the bank may face enforcement action from regulators if it's unable to bolster its capital and operations.
first-quarter sales fell 1% to $2.16 billion because of a decrease in promotional spending and a drop in volume. Campbell Soup's first-quarter earnings fell to $265 million from $279 million a year ago. The company's per-share earnings of 82 cents a share topped analysts' estimates of 79 cents. Shares were tumbling 6.5%.
, the computer and printer maker, said adjusted earnings per share fell 12% from last year to $1.17 per share. Adjusted net revenue for the quarter ended in October dropped 3% to $32.30 billion. Analysts were expecting profit of $1.13 a share on sales of $32 billion. Shares were surrendering 4%.
said fiscal fourth-quarter profit fell 3%.The maker of Spam said net income fell to $117.3 million, or 43 cents a share, from $121.1 million, or 45 cents, last year. Analysts were expecting a profit of 42 cents a share. Shares were rising 1%.
Networking equipment company
blew past Wall Street's expectations in its fiscal fourth quarter, reporting adjusted earnings of $79 million, or 16 cents a share. Revenue was $550 million, up 9% on a sequential basis but virtually flat from last year. Analysts were calling for a profit of 10 cents a share in the latest quarter on revenue of $527.4 million. Shares were gaining 10.7%.
Online movie rental company
says it's raising an additional $200 million in capital through the sale of zero coupon convertible notes. Technology Crossover Ventures will be buying the notes, and has the right to nominate one person Netflix's board. Shares were falling 2%.
The December gold contract was up $18.70 to $1,697.30 an ounce. January crude oil futures were up 19 cents to $97.11 a barrel.
The U.S. dollar was trading sideways against a basket of currencies, with the U.S. dollar index down 0.02%. The ten-year Treasury was down 5/32, raising the yield to 1.969%.
London's FTSE fell 0.3% Tuesday, and Germany's DAX lost 1.22%. Overnight, Asian stocks closed mixed. Japan's Nikkei Average was down 0.40%, and Hong Kong's Hang Seng was up 0.14%.
-- Written by Andrea Tse in New York.
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