Wall Street: Tues mid-session
STOCKS slumped after gauges of Midwest business activity and US consumer confidence missed Wall Street expectations and whipped up fears over the pace of the nation's economic recovery.
A disappointing outlook from Sun Microsystems added more pressure to the market ahead of the quarterly earnings season. The network computer maker spiraled more than 14% lower and topped the Nasdaq's most active list.
The technology-laced Nasdaq Composite Index dropped 33 points, or 1.84%, to 1,791, while the blue-chip Dow Jones industrial average lost 131 points, or 1.40%, to 9,249. The broader Standard & Poor's 500 Index fell 13 points, or 1.37%, to 992.
Corporate profit warnings ahead of the earnings season in October and a batch of mixed economic reports are heightening concerns that the pace of the recovery may not be strong enough to support the big run-up in share prices over the past six months.
'The market cannot make another significant move higher unless it shows this recovery is sustainable,' said Bill Strazzullo, market strategist with State Street
The National Association of Purchasing Management-Chicago business barometer sank to 51.2 from 58.9 in August. Economists polled by Reuters had pegged the September index at 57.0.
The Conference Board's consumer confidence index for September fell to 76.8 from a revised 81.7 in August. Economists had forecast a rise to 81.8 in September.
Sun Microsystems tumbled 55 cents to $3.31 after warning of a larger-than-expected loss in its fiscal first quarter. Sun's rivals followed the downward trend. Hewlett-Packard slumped 46 cents, or 2.3%, to $19.16. International Business Machines dropped 93 cents, or 1%, to $88.52. Dell fell 70 cents, or 2%, to $33.53.
Enterasys Networks plunged $1.77 or 31.1%, to $3.93 and ranked as the most active on the New York Stock Exchange. The company said it expects third-quarter revenue to be down 8 to 13% from second-quarter revenue as some customers delayed purchasing decisions. Regeneration Technologies sank $3.97, or 29.4%, to $9.55. The processor of human tissue for transplants warned that its third-quarter revenue would be lower than its previous target.
