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Wednesday November 15, 1:32 AMUS stocks slip as Home Depot offsets PPI, profitsNEW YORK, Nov 14 (Reuters) - U.S. stocks fell on Tuesday as Home Depot Inc.'s disappointing outlook outweighed optimism about strong profits of discounters Wal-Mart Stores Inc. and Target Corp. and expectations that the Fed will keep interest rates steady.A Labor Department report released before the bell showed U.S. core producer prices, stripping out food and energy costs, took their sharpest tumble in more than 13 years in October. For details see [ID:nN09284431]. But the PPI report coincided with a profit warning from Home Depot, the No. 1 U.S. home improvement chain, whose stock slid 0.7 percent on the New York Stock Exchange and was among the biggest drags on both the Dow and the S&P 500. Financial companies, including Citigroup Inc. , also featured on the losers' board as U.S. Treasury yield spreads pointed to higher funding costs for loans. In addition, traders attributed the weakness to a view that the market had now already priced in expectations of stronger third-quarter profits, prompting some investors to lock in profits. "The PPI report points more to a Goldilocks situation," said Stephen Massocca, co-chief executive of San Francisco-based investment bank Pacific Growth Equities. "But whether you have good news or bad news, the market has moved up quite a bit over the last couple of weeks, so it needs time to consolidate its gains here." The Dow Jones industrial average was down 37.06 points, or 0.31 percent, at 12,094.82. The Standard & Poor's 500 Index was down 3.99 points, or 0.29 percent, at 1,380.43. The Nasdaq Composite Index was down 6.99 points, or 0.29 percent, at 2,399.46. Immediately after Tuesday's open, the Nasdaq climbed to 2,410.94, its highest level in almost six years. But by mid-morning, the Nasdaq had dipped a toe into negative territory, with Microsoft Corp. and Cisco Systems Inc. among the biggest drags on the Nasdaq 100. The S&P 500, the broadest gauge of U.S. stock market performance, and the blue-chip Dow Jones industrial average, have each gained 12 percent since U.S. stocks bottomed out in mid-July. Last week, the Dow hit an all-time peak of 12,196.32. Home Depot shares dropped 0.7 percent, or 27 cents, to $36.14 on the NYSE. In contrast, shares of Wal-Mart, the world's biggest retailer, jumped 2.2 percent, or $1.01, to $47.25 after its quarterly profit beat expectations. Target's quarterly profit also topped estimates, sending the stock of Wal-Mart's rival discounter up 0.7 percent to $58.16. Shares of Citigroup, the world's biggest financial services company, dropped 1 percent to $50.16. On Nasdaq, shares of Microsoft slipped 0.6 percent to $29.08 and Cisco's stock declined 0.8 percent to $26.48. Investors may be exercising some caution in the tech sector after Cisco's rally last week and ahead of a quarterly earnings report on Thursday from Dell Inc. , the world's second-largest personal computer maker. Dell's stock was down 0.6 percent at $25.33. |
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