NEW YORK >> Wall Street looked askance at earnings reports today, with investors bidding stocks sharply lower despite healthy profits at such companies as 3M. The Dow Jones industrials slid more than 143 points, giving the blue chips a drop of nearly 400 points over four straight losing sessions.
War fears overshadow
jump in profit strength
By Amy Baldwin
Analysts said a spate of disappointing corporate outlooks last week along with ongoing fears of war with Iraq caused investors to be skeptical of better-than-expected earnings.
"The reference that the economy might not have had a demonstrable turn yet is really setting people off," said Ned Riley, chief investment strategist at State Street Global Advisors.
Concerns about war increased after news that a gunman in Kuwait opened fire on an SUV carrying American civilians, killing one and wounding another. The U.S. Embassy labeled it a terrorist act.
"Despite the (earnings) data -- and we have had some favorable data -- this market is still focused on talk of war, the probability of war and the effects of war and much of that was exacerbated by the fatal shooting in Kuwait," said Alan Ackerman, executive vice president at Fahnestock & Co.
Declining issues outnumbered advancers nearly 3 to 1 on the New York Stock Exchange where trading volume was light.
The Dow Jones industrial average closed down 143.84, or 1.3 percent, at 8,442.90. The Dow, down for four straight days, added to last week's 2.3 percent loss, which came amid cautious outlooks from companies including Intel and IBM. With two other triple-digit declines, the Dow has dropped 399.72, or 4.5 percent, since Wednesday.
The broader market also retreated for the fourth day in a row. The Nasdaq composite index fell 11.94, or 0.9 percent, to 1,364.25, following a weekly decline of 4.9 percent. The Standard & Poor's 500 index fell 14.16, or 1.6 percent, to 887.62, having dropped 2.8 percent last week. The Russell 2000 index fell 4.93, or 1.3 percent, to 383.17. It dropped 2.1 percent last week. The market was closed yesterday for the Martin Luther King Jr. holiday.
The price of the Treasury's 10-year note was up 3/8 point, while its yield fell to 3.97 percent from 4.02 percent Friday. Two-year Treasury notes were up 1/16 point, their yield fell to 1.64 percent, from 1.69 percent late Friday.
Investors were trading cautiously, awaiting fourth-quarter results and corporate outlooks in what is likely to be the busiest week in the earnings reporting season.
Companies that exceeded expectations last week but issued cautious forecasts traded lower again today. IBM fell 76 cents to $80.54 and Intel declined 5 cents to $16.29, having said last week that it was reducing capital spending by roughly $1 billion this year.
And, 3M declined 68 cents to $125.64 despite also exceeding earnings expectations by a penny a share.
Overseas, Japan's Nikkei stock average finished up nearly 1.8 percent. In Europe, France's CAC-40 fell 0.9 percent, Britain's FTSE 100 declined 1.1 percent and Germany's DAX index lost 0.8 percent.