Closing Bell: Mixed Earnings Tug Markets Lower; Apple Jumps

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Stocks mostly headed lower Wednesday, following a mixed bag of corporate earnings reports, though technology shares showed renewed strength after Apple reported stronger-than-anticipated earnings.

The Dow Jones industrial average (^DJI) lost 25.50 points, or 0.16 percent, to end at 15,542.24, while the S&P 500 (^GSPC) slipped 6.45 points, or 0.38 percent, to 1,685.94. The Nasdaq Composite Index (^IXIC) added just 0.33 of a point, or 0.01 percent, to close at 3,579.60.

A gloomy outlook from Caterpillar (CAT), a Dow component, tugged the stock market lower. The world's largest maker of construction and mining equipment reported that second-quarter earnings fell 43 percent as dealers cut inventories more than the company expected. Caterpillar also cut its profit and revenue outlook for the year. The stock lost $2.07, or 2.42 percent, to $83.45.

Apple (APPL) led a rise in technology stocks after the gadget maker beat analyst estimates for quarterly earnings and revenue. The company reported Tuesday that it shipped more iPhones in the latest quarter and also announced plans to introduce new products in the fall. Apple jumped $21.59, or 5.15 percent, to $440.58.

Despite some high-profile misses this earnings season, the larger trend for corporate profits looks good. Analysts forecast that second-quarter earnings for companies in the S&P 500 increased 4.2 percent over the same period last year, according to S&P Capital IQ. More than six out of every 10 companies have hurdled Wall Street's earnings targets.

Financial firms such as Goldman Sachs (GS) and Capital One (COF) have posted the highest rate of earnings growth of any industry. Pull their results out of the total, however, and earnings are on track to slump 3.5 percent, according to FactSet.

Among Stocks in the News:

  • Ford (F) reported better-than-expected earnings for the second quarter and raised its profit and sales forecasts for the year as strong U.S. pickup truck demand and growing sales in China offset persistent -- but narrowing -- losses in Europe. Shares rose 43 cents, or 2.54 percent, to $17.37.

  • PepsiCo (PEP) reported a better-than-expected quarterly profit and said its mixed portfolio played a role, underscoring its resistance to splitting up its drinks and snacks businesses. The stock lost 49 cents, or 0.57percent, to $85.71.

  • WellPoint (WLP) fell 9 cents, or 0.09 percent, to $87.43, after reporting second-quarter revenues that soared 16 percent to $17.6 billion and adjusted earnings were $2.60 a share. Analysts expected adjusted earnings of $2.08 a share on $17.81 billion in revenue, according to FactSet.

  • AT&T (T) fell 42 cents, or 1.17 percent, to $35.39 after the company reported Tuesday that its profit fell in the latest quarter as costs surged. AT&T's coffers were drained by smartphone sales, which it subsidizes in the hope of making money back over the life of two-year contracts.

  • Lumber Liquidators (LL) said that its second-quarter net income jumped nearly 68 percent as sales rose and costs fell, increasing profit margins. The hardwood flooring retailer's stock soared $5.85, or 6.75 percent, to $92.46.

  • Rollins (ROL) said that its second-quarter profit increased nearly 9 percent on improved demand for its pest control services, but revenue for the period fell short of market expectations. The stock fell $1.31, or 4.73 percent, to $26.39.

  • A top-selling antidepressant helped drugmaker Eli Lilly (LLY) cope with a revenue drop from another key product and turn in a second-quarter performance that topped Wall Street expectations. Shares rose $1.55, or 3.04 percent, to $52.54.

  • Dell (DELL) delayed its shareholder meeting for the second time in two weeks, moving it to Aug. 2 to give the special committee of its board time to consider an improved buyout offer by Michael Dell. The company's founder raised his offer for the struggling computer maker by 10 cents a share in hopes of attracting more shareholder support. Shares rose 4 cents, or 0.31 percent, to $12.92.

What to Watch Thursday:

8:30 a.m. Eastern time:

  • The Labor Department releases weekly jobless claims.

  • The Commerce Department releases durable goods orders for June.

10 a.m.:

These major companies are scheduled to report quarterly earnings:

  • 3M Co. (MMM)

  • Inc. (AMZN)

  • Baidu Inc. (BIDU)

  • Bunge Ltd. (BG)

  • Colgate Palmolive (CL)

  • General Motors Co. (GM)

  • Southwest Airlines Co. (LUV)

  • Starbucks Corp. (SBUX)

  • Unilever (UN)

  • United Continental Holdings Inc. (UAL)

  • Xerox (XRX)

  • Zynga Inc. (ZNGA)

-Compiled from staff and wire reports.