Drop in oil prices
fails to lift market

The Dow Jones loses more than
100 points in earnings anxiety

NEW YORK » A sharp slide in oil prices wasn't enough to keep stocks aloft yesterday as March retail sales fell short of expectations and investors grew apprehensive about weak consumer spending. The Dow Jones industrial average sank more than 100 points in the face of glum corporate outlooks and anxiety about first-quarter results.

A bleak forecast from Harley-Davidson Inc. started the day on a sour note, and things only got worse for equity investors after the decline in fuel prices failed to lift stocks. The energy sector itself dropped 2.46 percent, making it one of the worst-performing segments of the market; the only sector to deliver a positive performance for the day was health care. This surprised some analysts, as it suggested a shift away from the commodity-driven stocks that have led the market, but few were alarmed by the pullback.

"The decline today reflected fear, really, of earnings announcements, and the weak retail sales. But the traditional ingredients for a bear market, I just don't think, are in place yet," said Ken Tower, chief market strategist for Schwab's CyberTrader.

The Dow closed down 104.04, or 0.99 percent, at 10,403.93.

The broader gauges also fell. The Standard & Poor's 500 index lost 13.97, or 1.18 percent, to 1,173.79. The Nasdaq composite index fell 31.03, or 1.55 percent, to 1,974.37.

Crude futures sagged after the International Energy Agency forecast slower growth in oil demand this year, and the U.S. Department of Energy reported a larger-than-expected build in fuel supplies. Light, sweet crude for May delivery shed $1.64 to settle at $50.22 per barrel on the New York Mercantile Exchange. Analysts said the lack of a positive reaction in stocks suggests investors may be skeptical about whether the declines will stick.

The hints of a drop-off in consumer spending were exacerbated by a disappointing outlook from Harley-Davidson, which plunged 17 percent, or $9.84, to $48.93. The motorcycle manufacturer's earnings beat estimates by a penny a share, but it cut its shipment and profit forecasts for the year due to weaker sales.

"This Harley thing was a big deal today. It's suggestive of not-very-good returns, potentially, from a lot of consumer discretionaries. It's a big reaction," said Frank Husic, chief investment officer at Husic Capital Management in San Francisco.