Thursday, October 17 15:08:21
U.S. stocks fell today as investors shifted their focus to earnings of heavyweight companies such as IBM, in the wake of an agreement by lawmakers in Washington to reopen the federal government and raise the debt ceiling.
International Business Machines Corp was among the biggest decliners, hitting a two-year low a day after reporting a 4 percent drop in third-quarter revenue, worse than expected, amid a decline in hardware and emerging markets even as it beat profit estimates.
As of Wednesday's close, 61 companies representing 18.8 percent of S and P 500's market-cap have reported, with revenues missing expectations by 0.5 percent and earnings beating forecasts by 4.5 percent, according to RBC Capital Markets.
Earnings have been particularly strong for financials with results beating expectations by 6.2 percent and year-on-year growth of 16.4 percent, said Jonathan Golub, chief U.S. market strategist at RBC. Excluding financials, results have surprised by 3.3 percent and grew by 8.6 percent for those that have reported.
"While investors had been concerned about lower FICC trading activity and mortgage volumes, this seems to have been offset by stronger loan activity and improved credit quality," Golub said.
On Thursday, 24 companies representing 7 percent of the S&P 500 index report results, including Google after the market close.
The Dow Jones industrial average was down 85.91 points, or 0.56 percent, at 15,287.92. The Standard and Poor's 500 Index was down 3.80 points, or 0.22 percent, at 1,717.74. The Nasdaq Composite Index was down 9.89 points, or 0.26 percent, at 3,829.54.