NEW YORK |
NEW YORK (Reuters) – Stocks were little changed at the open on Tuesday as an earnings season expected to show sluggish corporate growth gets under way.
Profits in the fourth quarter are seen above the previous quarter’s lackluster results, but analysts’ current estimates are down sharply from where they were in October. Quarterly earnings are expected to grow by 2.8 percent, according to Thomson Reuters data.
If earnings growth appears to be “less bad” than expected that would translate into a near-term uptick in the market, according to Eric Wiegand, senior portfolio manager at U.S. Bank Wealth Management in New York.
“But I think there’s still ample areas for concern,” he said, listing policy worries in Washington and uneven economic activity as a result of Superstorm Sandy during last quarter.
The Dow Jones industrial average .DJI fell 40.65 points, or 0.30 percent, to 13,343.64. The SP 500 .SPX lost 4.28 points, or 0.29 percent, to 1,457.61. The Nasdaq Composite Index .IXIC dropped 5.04 points, or 0.16 percent, to 3,093.78.
German data showed industrial orders fell more than forecast in November due to a sharp drop in demand from abroad, reinforcing concerns that Europe’s largest economy may have contracted in the fourth quarter of 2012.
Monsanto Co (MON.N) shares rose 3.2 percent to $99.05 after hitting a more than four-year high at $99.99. The world’s largest seed company raised its earnings outlook for fiscal 2013 and posted strong first-quarter results.
Education provider Apollo Group (APOL.O) and Dow component Alcoa Inc (AA.N), the largest U.S. aluminum producer, round out the start of earnings season after the closing bell.
Shares of restaurant-chain operator Yum Brands Inc (YUM.N) fell 4.6 percent to $64.78 a day after the KFC parent warned sales in China, its largest market, shrank more than expected in the fourth quarter.
London-traded Vodafone (VOD.L) shares rose almost 2 percent after its partner in U.S. joint venture Verizon Wireless said it would be “feasible” to buy out the British group. U.S.-traded Vodafone stock (VOD.O) fell 1.5 percent.
Sears Holdings (SHLD.O) shares fell 1.4 percent to $42.31 a day after the company said its chief executive will step down for family health reasons. The U.S. retailer also reported a 1.8 percent decline in quarter-to-date sales at stores open at least a year.
GameStop (GME.N) shares fell 7.1 percent to $23 after it reported sales for the holiday season and cut its guidance.
(Reporting by Rodrigo Campos; Editing by Nick Zieminski)