Stocks edged lower on Tuesday, reflecting a negative reaction to quarterly results from Texas Instruments (TXN), a weaker-than-expected report on consumer confidence, and a spike in oil prices and Treasury bond yields.
The Dow Jones industrial average fell 7.13 points, or 0.07%, to 10,377.87. The broader Standard & Poor's 500 index was down 2.84 points, or 0.24%, to 1,196.54. The tech-heavy Nasdaq composite index lost 6.38 points, or 0.3%, to 2,109.45.
Among stocks in the news, Cablevision (CVC) canceled a plan to go private and is mulling a special $3 billion dividend instead.
Sovereign Bancorp (SOV) says it will acquire Independence Community Bank (ICBC) for $42 per share, or a total of $3.6 billion.
In earnings news, Texas Instruments (TXN) posted third-quarter earnings per share of 38 cents, vs. 32 cents a year ago, on a 10% revenue rise. Those results includes stock-based compensation expense. The chip maker's outlook disappointed analysts; it expects fourth-quarter revenue of $3.425-$3.715 billion and 36-40 cents EPS.
Altera (ALTR) posted third-quarter EPS of 21 cents, vs. 22 cents a year ago, as narrowed gross margin offset a 10% sales rise. It expects flat fourth-quarter sales from the third quarter, plus or minus 2%, and gross margins of 66%.
Lexmark International (LXK) shares were also lower after the printer maker reported disappointing results. It said third-quarter EPS fell to 59 cents, from $1.17 a year ago, on a 4% revenue drop. The company expects many factors that impacted the third quater to affect the fouth-quarter.
Other companies on this week's busy earnings calendar include BellSouth (BLS), Microsoft (MSFT), Boeing (BA), Sprint Nextel (S), ExxonMobil (XOM), Verizon (VZ), and more.
On the economic front, the October reading for consumer confidence slipped to 85.0, after tumbling 18 points to a revised 87.5 in September. The present situations component fell to 108.2 from a revised 110.4. The expectations component was 69.5 from a revised 72.3. The data are weaker than expected and may further pressure the dollar lower, says Action Economics.
September existing home sales were steady at a 7.28 million units pace. The data are stronger than expected and continue to show a hot housing market, says Action Economics.
In the energy markets, December NYMEX crude rallied sharply on Tuesday, rising $2.12 to $62.44 a barrel. Natural gas and heating oil led the charge, up over 10% and 5% respectively, on forecasts of colder weather throughout the U.S this week, says Action Economics. Focus will turn to Wednesday's weekly inventory data, where the Street expects a 2.3 million barrel build in crude stocks, a 1.4 million barrel rise in gasoline supplies, and a 900,000 draw in distillate supplies, which includes heating oil.
Treasury yields pressed sharply higher over the course of Tuesday's session after initially dipping on the still-soft consumer confidence print in October, says Action Economics. The 10-year note yield shot up to 4.52%.
European stock markets finished lower on Tuesday. London's Financial Times-Stock Exchange 100 index was down 25.5 points, or 0.49%, at 5,182.1.
Germany's DAX index fell 28.82 points, or 0.59%, to 4,872.97 on mixed earnings and profit taking. But some investors were encouraged that the German October Ifo index jumped to a five-year high of 98.7 from 96.0 in September, says Standard & Poor's MarketScope.
In Paris, the CAC 40 index lost 24.98 points, or 0.56%, to 4,396.99.
Asian markets finished higher on Tuesday. In Japan, the Nikkei 225 index jumped 174.44 points, or 1.33%, to 13,280.62, boosted by gains on Wall Street overnight. Stock market bulls were speculating that weakness in October presents a buying opportunity, expecting the strong uptrend seen this year on the back of optimism about economic growth to resume, says Standard & Poor's MarketScope.
In Hong Kong, the Hang Seng index rose 22.53 points, or 0.16%, to 14,424.88, as gains were capped by concerns about the avian flu, says Standard & Poor's MarketScope.