Stocks retreat as weak earnings provide no joy
(Associated Press Via Acquire Media NewsEdge) NEW YORK -- Stocks slumped on Wall Street Thursday, suggesting that the rally which has pushed indexes close to record levels may have run its course.
The Dow Jones industrial average was down 118 points at 13,870 as of 12:04 p.m. The index has shed almost 1 percent since the start of the week, after logging its best January in almost two decades.
The Standard and Poor's 500 fell 11 points to 1,502 and the Nasdaq composite dropped 24 points to 3,145.
"We had such a big January, some type of weakness, or consolidation, make sense here to us," said Ryan Detrick of Schaeffer's Investment Research in Cincinnati.
The S&P 500 has lost an average of 0.58 percent in February over the last 20 years, making it the weakest month for stocks, according to research by Schaeffer's.
News Corp. fell 63 cents to $27.59 after the media conglomerate cut its forecast for annual earnings. The company said weakness at several businesses, including its Fox broadcast network, would offset a gain in earnings in the most recent quarter. Auto parts retailer O'Reilly Automotive surged $8.95 to $101.5 after it reported earnings late Wednesday that beat analysts' forecasts.
Stocks fell even after a report showed that applications for unemployment benefits declined.
Fewer Americans sought unemployment benefits last week, a sign that layoffs are easing. Applications for unemployment benefits fell 5,000 to 366,000. Worker productivity also shrank in the final three months of 2012, although the decline was caused by temporary factors.
Comments from European Central Bank president Mario Draghi also caught the attention of investors. The central banker pledged to keep a close eye on the economic impact of the rise of the euro, fearing that the currency's rally in recent month could hurt export sales and harm the region's fragile economy further.
Stocks also fell on Monday, partly because of a spike in borrowing costs for Italy and Spain. That reignited concerns that those countries won't be able to service their debts.
As stocks slumped, bonds rallied. The yield on the 10-year Treasury note, which moves inversely to its price, fell 2 basis points to 1.94 percent.
Among other stocks making big moves;
_ Akamai Technologies Inc., which helps websites deliver online content, plunged $6.71 to $34.91, after reporting earnings late Wednesday. Net income rose, but revenue missed forecasts.
_ Sprint Nextel Corp., the country's third-largest wireless carrier, fell 8 cents to $5.69. Sprint lost $1.3 billion in its fourth quarter as it revamped its network to take on its larger competitors. The company also lost 243,000 customers in contract-based plans in the quarter.
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