Wall Street ended largely flat Tuesday in an abbreviated trading session ahead of today’s Fourth of July holiday.
But a continuing stream of earnings warnings left some experts wondering if analysts have lowered their second-quarter profit estimates enough to account for weak sales.
Meanwhile, bond yields rose on some upbeat economic data.
In the stock market, the Dow Jones industrials eased 22.61 points, or 0.2%, to 10,571.11, while the Nasdaq composite slipped 7.92 points, or 0.4%, to 2,140.80.
Winners had a narrow edge over losers on the New York Stock Exchange, while losers led on Nasdaq.
Markets, as planned, closed up shop three hours early amid slow trading ahead of the holiday.
The Dow and Nasdaq were weighed down as another batch of companies large and small warned that quarterly earnings won’t meet already lowered expectations.
Chemical giant DuPont late Monday warned of weak results because of the soft economy and the strong dollar, sending its shares down 92 cents to $47.20.
In the tech sector, a number of software firms, including BroadVision, Rational Software and Internet Security Systems, cut their second-quarter forecasts.
Although Wall Street has been expecting the second quarter to be weak, the latest warnings raise the prospect that actual results, which will be reported starting next week, could be even worse than expected.
The market’s bulls, however, say investors already are looking ahead to an anticipated profit rebound in the fourth quarter. Though DuPont fell Tuesday, for example, the stock still is up 17% from early April.
The Treasury bond market also is betting on an economic recovery: Yields rose Tuesday after the government reported a jump in U.S. factory orders in May.
The yield on the 10-year T-note rose to 5.38% from 5.32% on Monday.
Among Tuesday’s highlights:
* Profit warnings dragged BroadVision down 89 cents to $4.04, Rational Software down $5.33 to $22.12 and Internet Security Systems down $20.18 to $29.99.
Also, Check Point Software fell $6.40 to $44.55 after saying quarterly sales will be slightly short of estimates, though earnings will be in the range of estimates.
* Among other tech shares, Emulex fell $2.05 to $37.69, Remedy slid $2.06 to $31.95 and Cisco Systems eased 3 cents to $19.19, but EMC rose $1.02 to $31.62 and FreeMarkets gained $1.87 to $21.27.
* Playboy surged $2.25 to $19.75 after the firm agreed to buy three XX-rated sex channels in a bid to boost growth.
* Gold-mining stocks, big gainers in the second quarter, rose further. Hecla Mining surged 38 cents to $1.40 and Ashanti Gold jumped 43 cents to $3.60.
* Argentine stocks fell anew on concern that fresh political turmoil could hurt government efforts to pull the economy out of a recession and avoid default on $130 billion in public debt.
The main Merval stock index slid 4.2% as bond yields surged. Brazilian stocks lost 1.4%.
Bloomberg News said investors are concerned that Economy Minister Domingo Cavallo, who has introduced tough economic measures in the last three months, might face new resistance from opposition governors.
Market Roundup, C7, C8