A mixed batch of corporate earnings helped drag the major U.S. stock indexes down slightly Tuesday, pulling the market further from its recent record highs for the second straight day.
Mixed or disappointing reports from Under Armour, Dish Network, Corning, HCA, Beyond Meat and others weighed on the market. Capital One Financial slumped 5.9% after the credit card issuer and bank disclosed that a hacker stole personal information of more than 100 million of its credit card applicants.
Apple climbed 3% in after-hours trading after its latest results handily beat analysts’ estimates.
Home builders bucked the broader decline after D.R. Horton reported strong quarterly results and gains in orders of new homes.
This week’s modest market pullback came as investors looked cautiously ahead to Wednesday’s policy update from the Federal Reserve. The central bank is widely expected to cut its benchmark interest rate for the first time in a decade. Rate cuts could help inoculate the U.S. economy against a potential downturn.
The Standard & Poor’s 500 index fell 7.79 points, or 0.3%, to 3,013.18. Despite its two-day slide, the benchmark index remains within 0.4% of the all-time high it set Friday.
The Dow Jones industrial average slipped 23.33 points, or 0.1%, to 27,198.02. The Nasdaq composite fell 19.71 points, or 0.2%, to 8,273.61. Still, the indexes are poised to close July with solid gains.
Small-company stocks fared better than the rest of the market. The Russell 2000 index rose 16.57 points, or 1.1%, to 1,585.60.
Bond prices fell. The yield on the 10-year Treasury note rose to 2.06% from 2.05%.
Technology stocks accounted for the biggest share of the selling Tuesday. Communications services stocks, retailers and healthcare companies also weighed on the market. Energy stocks led the gainers, benefiting from a 2.1% pickup in U.S. crude oil prices.
Companies are about midway through earnings reporting season, and results generally have beaten analysts’ dismal expectations. Still, companies that reported disappointing quarterly results Tuesday put investors in a selling mood.
Gartner led the tech-sector decline, tumbling 19% after the research company cut its earnings and revenue guidance.
Under Armour dived 12.2% after the sports apparel company’s revenue fell short of Wall Street forecasts. The company also said it expects a slight sales decline in North America this year, and its overall profit forecast for 2019 is weaker than analyst forecasts.
Dish Network slid 8.7% after the satellite television provider’s quarterly profit fell short of analysts’ forecasts.
Beyond Meat slumped 12.3% after the maker of plant-based burgers reported a bigger quarterly loss than Wall Street expected and announced a stock sale. The loss and secondary stock offering overshadowed solid sales results and an increased sales forecast.
Offshore drilling company McDermott International plunged 35.3% after it slashed its financial forecast and told investors it will register a loss in 2019.
Other companies’ results impressed.
Procter & Gamble shares rose 3.8%, leading consumer products makers up, after the company reported results that easily beat Wall Street forecasts.
D.R. Horton climbed 5.7% after the home builder’s quarterly earnings and revenue topped estimates. The builder, which touted increased new-home orders and prices, also authorized up to $1 billion in share buybacks. It helped boost most other home builder stocks.
Traders also had their eye on the U.S.-China trade war as negotiators began a new round of talks.
The trade war has been cutting into corporate profit for some industries all year, and investors worry that it will continue to crimp business investment and growth. Delegates from the United States and China are meeting in Shanghai this week in the latest round of negotiations, months after the trade spat escalated with more tariffs.
President Trump ramped up criticism of Beijing just as the new round of talks began Tuesday. In a series of tweets, Trump said China is trying to hold off on an agreement until after the next U.S. elections. Trump threatened to get “much tougher” with China on trade if he wins in 2020.
The remarks didn’t appear to have much of an effect on the market, however.
“Investors are coming to the realization that this is going to be a long-and-drawn-out process, and they can’t bet the farm every single time that there’s some type of announcement,” said Karyn Cavanaugh, senior markets strategist at Voya Investment Management.
Investors were also looking ahead to other potentially market-moving events this week, including a government jobs report Friday.
Benchmark crude oil rose $1.18 to $58.05 a barrel. Brent crude oil, the international standard, rose $1.01 to $64.72 a barrel. Wholesale gasoline rose 4 cents to $1.90 a gallon. Heating oil rose 3 cents to $1.94 a gallon. Natural gas stayed at $2.14 per 1,000 cubic feet.
Gold rose $9.30 to $1,429.70 an ounce. Silver rose 13 cents to $16.50 an ounce. Copper fell 4 cents to $2.67 a pound.