US stocks fell yesterday, driving the Dow industrials to the biggest drop since 21 June, as weak results from index members DuPont and United Technologies showed profit growth is slowing.
This earnings season has so far produced a string of disappointments from companies falling short of Wall Street’s expectations. With results in from 29 per cent of S&P 500 companies, 37 per cent have exceeded revenue forecasts, far short of the 62 per cent average, and just 57.2 per cent of the S&P 500 names reporting so far have beaten earnings forecasts, according to Thomson Reuters data.
“We’ve had a series of misses, topped off by DuPont’s pretty dismal earnings this morning,” said Bruce Zaro, chief technical strategist at Delta Global Asset Management.
“Expectations were low and results have been coming in generally lower, and that’s why we’re seeing weakness here,” he said.
Facebook provided some cheer after the bell, however, with revenues that beat expectations to send its shares up around 10 per cent in after-hours trading.
The Dow Jones industrial average slid 243.36 points, or 1.82 per cent, to 13,102.53 at the close. The Standard & Poor’s 500 Index fell 20.71 points, or 1.44 per cent, to 1,413.11. The Nasdaq Composite Index dropped 26.49 points, or 0.88 per cent, to end at 2,990.46.
DuPont’s stock lost 9.1 per cent to $45.25 after the chemical company reported lower-than-expected quarterly profit and announced 1,500 job cuts.