Negative earnings
drive stocks down

U.S. stocks fell as disappointing results from companies including Motorola Inc. and Lucent Technologies Inc. overshadowed economic data that showed declines in consumer prices and jobless claims.

"There's some realization that the growth rate in earnings is slowing down," said Eric Thorne, who helps oversee $1.8 billion at Bryn Mawr Trust Co. in Bryn Mawr, Pa. "That's weighing on the market a little bit."

The Standard & Poor's 500 Index dropped 11.35, or 1 percent, to 1184.63. The Dow Jones Industrial Average retreated 88.82, or 0.8 percent, to 10,539.97. The Nasdaq Composite Index fell 32.45, or 1.5 percent, to 2073.59.

Seven stocks fell for every three that rose on the New York Stock Exchange. Some 1.5 billion shares changed hands on the Big Board, 1.1 percent more than the three-month daily average.

Benchmark indexes extended their declines in the final hour of trading, sending the S&P 500 and Nasdaq to their second- steepest losses in 2005. Today's slide followed the market's first back-to-back gains of the year.

Of the 80 companies in the S&P 500 that have reported results, about 63 percent beat analysts' estimates, 19 percent missed and 19 percent matched, according to Thomson Financial. Historically, 59 percent of the companies exceed expectations, while 20 percent trail and 21 percent are in line, said Thomson.

Even so, the S&P 500 has made no headway since Alcoa Inc. kicked off the reporting season on Jan. 10, losing 0.5 percent in the period. For the year, it's down 2.3 percent amid rising oil prices and concern that the Federal Reserve will step up its pace of interest-rate increases.

"It's becoming evident that so far earnings at best are just OK, not great," said Peter Boockvar, an equity strategist at Miller Tabak & Co. in New York. The "bulls got lulled into a complacency that earnings would be just fine."

Motorola fell $1.23 to $16.20. The No. 2 mobile-phone maker said it expects first-quarter earnings of 17 cents to 20 cents a share. The average analyst estimate is 20 cents, according to Thomson.

Lucent, the largest U.S. maker of telephone equipment, lost 28 cents to $3.42 after its fiscal first-quarter sales trailed analysts' estimates. Sales were $2.34 billion, less than the $2.41 billion analysts in a Thomson survey expected.

A gauge of computer and communication-equipment makers that includes Motorola and Lucent slid 2.6 percent for the worst performance among the S&P 500's 24 industry groups.