Stocks Drop on Tepid Earnings, Weak Eurozone Forecast
NEW YORK ( TheStreet) -- U.S. stocks dropped on Tuesday as lackluster corporate earnings reports and a tepid outlook for European growth offset an upbeat U.S. services sector report.
With stocks at near all-time highs, investors took profits on Tuesday as attention turns to government data on jobs and economic growth scheduled for later in the week. The Commerce Department is scheduled to issue its initial estimate of third-quarter growth on Thursday, and the Labor Department is slated to release its job report on Friday.
Forecasts from the European Commission on Tuesday suggested the eurozone economy would expand by 1.1% in 2014 and are down from a 1.2% growth forecast in May, when more bullish assumptions were made on private consumption and investment.
In company news, Tenet Healthcare
Expeditors International of Washington
The ISM non-manufacturing index for October arrived better than expected Tuesday at 55.4, above the consensus call of 54 as well as the 54.4 level reported in September, assuaging fears about the overall economic impact of the 16-day U.S. government shutdown in October. A score above 50 indicates that the non-manufacturing economy is generally expanding.
"It is reassuring that despite all the uncertainty emanating from Washington D.C. during October, non-manufacturing business activity continued to advance at a pace slightly above trend," Guy Berger, an economist at RBS in Stamford, Conn., said in a note.
In other economic news, U.S. chain-store sales rose 1.9% year on year for the week ended on Nov. 2, according to the International Council of Shopping Centers (ICSC) and Goldman Sachs. Comparable-store sales slipped 0.6% on a weekly basis. San Francisco Fed President John Williams will deliver a briefing at the city's Fed's Asia Economic Policy Conference at 5:10 p.m. Richmond Federal Reserve Bank President Jeffrey Lacker will speak on work force development in Charlotte, N.C., at 12:30 p.m.