Wall Street hits session lows on renewed profit concerns

NEW YORK (Reuters) - Stocks extended their slide to session lows on Friday as earnings from General Electric and Microsoft renewed worries about corporate profits, pulling down the technology and industrial sectors.

The sell-off occurred on the 25th anniversary of the stock market crash of 1987 - known as Black Monday - when the Dow Jones industrial average plummeted 22.6 percent - its worst single-day percentage loss.

Earnings from large multinationals underscored the effect of the global economic slowdown. General Electric Co shares fell 2.8 percent to $22.17 and ranked as the biggest drag on the S&P 500 after GE, the largest U.S. conglomerate, posted quarterly earnings that met Wall Street's expectations, but revenue fell short of estimates. GE, however, stood by its full-year earnings forecast.

"They hit on the earnings number, but revenues keep missing - that is the story that we are hearing across the line," said Ken Polcari, managing director at ICAP Equities, in New York.

"But all it does is it further solidifies the same story, that people are concerned, and although these companies are beating these (estimate) numbers, the numbers are much lower so the beat is not that difficult."

The beat rate for revenue forecasts so far is 41.4 percent, trailing both the 55 percent average over the past four quarters and the long-term average of 62 percent, according to Thomson Reuters data.

McDonald's Corp was the heaviest weight on the Dow industrials, down 3.6 percent at $89.58 after the world's biggest fast-food restaurant chain reported a lower quarterly profit that missed analysts' expectations.

The Dow Jones industrial average <.dji> dropped 150.16 points, or 1.11 percent, to 13,398.78. The Standard & Poor's 500 Index <.spx> lost 17.43 points, or 1.20 percent, to 1,439.91. The Nasdaq Composite Index <.ixic> fell 54.05 points, or 1.76 percent, to 3,018.82.

The sell-off occurred on the 25th anniversary of the stock market crash of 1987 - known as Black Monday - when the Dow Jones industrial average plummeted 22.6 percent - its worst single-day percentage loss.

Despite the day's declines, the S&P 500 has advanced 0.7 percent so far this week. The Dow is up 0.9 percent, but the Nasdaq is off 0.03 percent for the week. Each of the three major U.S. stock indexes advanced for the first three days of the week as corporate earnings appeared to be better than initially expected.

On Thursday, a string of earnings disappointments, including surprisingly weak results from Google that were erroneously released hours before they were expected, gave investors a reason to sell some stocks and the market finished lower. On Friday at midday, Google's stock was down 1.8 percent at $682.59.

Microsoft Corp said late Thursday its quarterly profit fell a greater-than-expected 22 percent, as sales of computers running its Windows operating system dipped and some revenue was deferred before the release of its core Windows and Office products. The stock slid 2.7 percent to $28.70.

But diversified U.S. manufacturer Honeywell International Inc was a bright spot, up 2.5 percent at $62.93 after reporting a 10 percent jump in quarterly earnings as declining natural gas prices helped increase profit at its UOP chemical arm, offsetting weakness in Europe.

The S&P industrials sector index <.gspi> tumbled 1.4 percent, while the S&P information technology sector index <.gspt> lost 1.7 percent.

Of the 116 S&P 500 companies that have reported results so far in this earnings season, 60 percent have exceeded analysts' estimates. Earnings are expected to drop 1.8 percent in the third quarter from a year ago, according to Thomson Reuters data, compared with a forecast calling for a drop of 2.3 percent earlier in the week.

Semiconductors added to the weakness, with a 3.9 percent gain in SanDisk Corp shares to $44.51 overshadowed by plunges of about 14 percent in both Marvell Technology Group Ltd and Advanced Micro Devices Inc . Both SanDisk and AMD posted quarterly results after the bell on Thursday, while Marvell cut its outlook.

The PHLX semiconductor index <.sox> slid 2.4 percent.

Data showed U.S. existing home sales fell in September as the inventory of properties on the market dropped, a reminder that America's housing sector is a long way from a full recovery despite recent signs of improvement.

(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)

Source: http://news.yahoo.com/stock-index-futures-mixed-eyes-ge-results-085807092--finance.html

carole king crystal renn matilda cab calloway melissa gilbert deadliest catch dwts