updated 4/23/2008 7:13:42 AM ET 2008-04-23T11:13:42

Wall Street pulled back Tuesday, with the Dow Jones industrials tumbling more than 100 points as a rush of quarterly results from bellwethers like AT&T Inc., DuPont and McDonald’s Corp. failed to impress investors. Oil prices also reached fresh highs, raising concerns about inflation.

Major Market Indices

AT&T’s earnings met Wall Street’s forecast while McDonald’s and DuPont reported stronger-than-expected numbers. But DuPont said a U.S. slowdown will offset growth abroad and McDonald’s said an important metric of its sales showed a decline for March. All three companies are among the 30 stocks that make up the Dow.

The comments gave trading a cautious tone. With hundreds of companies still to report results, investors are anxious over what the figures might say about the prospects for the economy.

“We’ve melted here, but it isn’t a plunge,” said Art Hogan, chief market analyst at Jefferies & Co. “We’re in a day-to-day assessment of how good earnings season is, and right now there’s more bad news than good news — the parade has been less positive than we’ve anticipated.”

Investors appeared little moved by news of continued weakness in the housing sector. Sales of existing homes fell 2 percent in March to a seasonally adjusted annual rate of 4.93 million units, while the median sales price dropped for a seventh straight month. The National Association of Realtors also said sales rose in the Northeast and West but fell in the Midwest and South.

But oil’s seemingly relentless march higher this year raises the specter of higher inflation that would lead consumers to cut back their discretionary spending. It would also make the Federal Reserve less likely to keep lowering interest rates.

Light, sweet crude for May delivery rose as high as $119.90 barrel, then slipped back to settle at $119.37, up $1.89. But it appeared inevitable crude would pass $120.

The Dow fell 104.79, or 0.82 percent, to 12,720.23.

Broader stock indicators also declined. The Standard & Poor’s 500 index fell 12.23, or 0.88 percent, to 1,375.94, and the Nasdaq composite index fell 31.10, or 1.29 percent, to 2,376.94.

Bond prices edged up. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.69 percent from 3.72 percent late Monday. The dollar was mixed against other major currencies, while gold prices rose.

Some of the latest earnings reports appeared to confirm concerns about the economy, analysts said.

“It takes a while for the economy’s situation to work its way down to the companies,” said Alexander Paris, economist and market analyst for Chicago-based Barrington Research. “What’s going on is earnings are reflecting the reality of a slowing economy, and that should go on until the second half of the year.”

Late Monday, Texas Instruments Inc. warned of a weak market for the chips it makes for high-end mobile phones. The company’s results were nearly in line with Wall Street’s expectations, however. The stock fell $1.77, or 5.8 percent, to $28.82.

In other corporate news, CIT Group Inc. fell $1.99, or 15.6 percent, to $10.75 after the financial services company said it would raise $1.5 billion from an offering of common and preferred stock. The company has been hit by strains in the mortgage and credit markets.

AT&T rose 22 cents to $37.81 after reporting that its first-quarter earnings rose 22 percent following growth in the company’s wireless division and as its enterprise services business saw a reversal of an earlier decline.

DuPont said profits jumped 26 percent as the chemical company saw higher sales and benefits from the weak dollar. But the company’s comments about the U.S. market appeared to weigh on the stock, which fell $2.09, or 4 percent, to $50.16.

McDonald’s slipped 32 cents to $58.35 after saying its first-quarter earnings grew 24 percent. The fast food chain benefited from the weak U.S. dollar and strong global sales. However, it also said its same-stores sales, or sales at restaurants open at least a year, declined in March.

The rising price of oil again sent energy stocks higher. Exxon Mobil Corp. rose 13 cents to $94.39, while Chevron Corp. rose $1.33 to $94.03.

Declining issues outnumbered advancers by about 3 to 1 on the New York Stock Exchange, where volume came to 1.33 billion shares.

The Russell 2000 index of smaller companies fell 14.29, or 1.99 percent, to 703.71.

Overseas, Japan’s Nikkei stock average closed down 1.09 percent. In afternoon trading, Britain’s FTSE 100 fell 0.30 percent, Germany’s DAX index fell 0.86 percent, and France’s CAC-40 lost 0.77 percent.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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