Wednesday, October 17, 2012

Stocks lower amid new data, earnings

By NBC News wire services

Updated at 11:45 a.m. ET: Stocks pulled back Wednesday after data showed groundbreaking on new U.S. homes surged in September to its fastest pace since July 2008.

Earlier, Bank of America reported a quarterly profit, but the Nasdaq composite index slipped on weak tech company results.

Bank of America posted $340 million in net earnings, or nil per share. Analysts estimates were for a per-share loss.

Citigroup and Goldman Sachs posted strong results this week, also indicating improvement in the financial sector. But JPMorgan Chase and Wells Fargo disappointed investors.

Tech shares were pressured a day after both Intel Corp and IBM reported disappointing quarterly results, sending the stocks sharply down before the opening bell.

"There was a lot of pessimism going into earnings season, but overall I'm happy with what I'm seeing. Things seem to be improving for banks," said Scott Schermerhorn, chief investment officer at Granite Investment Advisors in Concord, New Hampshire.

"IBM and Intel were weak, but it isn't surprising to see such globally exposed companies hit by weakness in Europe and emerging markets."

Equities are coming off their best two-day advance in a month, a rise of 1.8 percent. Those gains came as some disappointments early in the earnings season were offset by strong results from such bellwethers as Johnson & Johnson.

Still, the first report cards from companies in the tech sector suggested reasons for caution. Late Tuesday, Intel gave a weak fourth-quarter revenue outlook while IBM posted third-quarter revenue that came in under expectations.

Earnings for S&P 500 components are seen falling 2.3 percent from a year ago, with the main culprit the slowing global economy. But the latest forecast does mark a slight improvement from estimates last week, according to Thomson Reuters data.

Reuters contributed to this report.

Source: http://marketday.nbcnews.com/_news/2012/10/17/14508042-stocks-lower-amid-new-data-earnings?lite

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