U.S. stocks were weak on Tuesday and ended down led by technology stocks as worries over third quarter earnings made investors sell in large numbers.
Chip-maker Intel shares fell nearly 3 percent after Robert Baird & Co cut the price target of the stock to $26 from $32 citing weak demand for notebooks.
At the close, the S&P 500 was 7.9 percent below its all-time closing high of 1,565.15, reached five years ago on this date.
The Dow Jones Industrial Average(INDEXDJX:.DJI) fell 110.12 points, or 0.81 percent, to 13,473.53 at the close. The S&P 500(INDEXSP:.INX) lost 14.40 points, or 0.99 percent, to 1,441.48. the NASDAQComposite(INDEXNASDAQ:.IXIC) dropped 47.33 points, or 1.52 percent, to close at 3,065.02.
About 5.8 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average so far this year of about 6.53 billion shares.
More than three issues fell for every one that rose in the NYSE. On the Nasdaq, about seven stocks fell for every two that rose.
It was an all-round dismal trading session and analyst said that third quarter earnings of the S&P 500 companies are seen to be declining 2.3 percent on year.
Energy stocks were the only gainers as crude oil prices spiked on concerns of supply disruptions from the Middle East.
The main drivers for the market this month will be the quarterly earnings that will give an idea of how corporate America has been performing over the last three months.
Several large companies such as FedEx Corporation(NYSE:FDX), Caterpillar Inc.(NYSE:CAT) and Hewlett-Packard Company(NYSE:HPQ) have already warned about weak quarterly earnings due to slowing demand in the U.S. and China.
Netflix, Inc.(NASDAQ:NFLX) slumped 11% after an analyst at Bank of America/ Merrill Lynch cut his rating on the stock from ‘Buy’ to ‘Underperform’ after a 31% rally in the stock over the previous two weeks.
The stock gained almost 40% last week after optimistic note by an analyst at Citigroup, this morning Scott Devitt at Morgan Stanley decided to rerate the stock upwardly and now rate the stock at Overweight, from its Equal Weight earlier.
Vringo, Inc.(NYSEAMEX:VRNG) shares had volatile session and ended lower 18% to $4.45 after reaching another record high of $5.73. The stock has been in news since the last week and investors have reacted positively to all the news with the stock has soared 80% in the past one week.
Firstly, last week, the court had ordered Google Inc (NASDAQ:GOOG) to negotiate with VRNG related to ongoing patent war, where the former was sued by later for infringement of a patent. Well, this off course is positive news for VRNG’s shareholders and the soared 58% last week. However, on the stock retreated on Friday after the company announced that it raised $45 million in a direct offering to five of its existing institutional investors at $4.35 a share.
BSD Medical Corporation(NASDAQ:BSDM) was up 74% after after the company announced a 391% increase in sales for the MicroThermX(R) Microwave Ablation System (MicroThermX(R)) product line for September 2012, as compared to September 2011. Disposable SynchroWave antennas were a significant portion of these sales, reflecting the success of the Company’s fee-per-use equipment rental program and increasing utilization of MicroThermX(R) equipment.