Disappointing earnings weigh down stock market

Associated Press Modified: October 22, 2012 at 2:15 pm •  Published: October 22, 2012
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NEW YORK (AP) — It's been a disappointing earnings season.

The stock market turned lower Monday afternoon as investors absorbed more underwhelming third-quarter earnings reports. Shares of toymaker Hasbro, clothing maker VF Corp., regional bank SunTrust and other companies fell.

The overhang of the presidential election in two weeks didn't help. Investors are wary of making big moves before they know who's going to be the next president.

"They need to know the playing field before they get out there and play," said Jeff Savage, regional chief investment officer for Wells Fargo Private Bank in Portland, Ore.

The major indexes were all down by mid-afternoon, after waffling between small gains and losses.

The Dow was down 83 points to 13,261 shortly before 3 p.m. The Standard & Poor's 500 index was down nine to 1,424 and the Nasdaq composite index fell five to 3,001.

Investors are also anxious about a government report due out Friday on how much the U.S. economy grew in the third quarter. The corporate earnings reports were full of signs that consumers, who drive the bulk of economic growth, are far from healed.

Hasbro, the toymaker behind brands like My Little Pony and Transformers, said that sales for boys' products and preschool toys were weaker than it had hoped, and it missed analysts' revenue predictions. The stock slipped 58 cents to $38.47.

Clothing maker VF Corp., whose brands include Timberland and Wrangler, also missed analysts' revenue estimates. Investors may have been disappointed that North Face sales were hurt by recession-riddled Europe. The stock lost $8.49, hitting $158.28.

SunTrust Banks also slipped. Its third-quarter earnings jumped, but that was largely because the bank sold shares it owned in Coca-Cola. The Atlanta-based bank wrestled with higher expenses as well as low interest rates, which can crimp the profit banks make from lending out money. The stock lost $1.19 to $27.44.

Shares rose for Caterpillar, the world's largest construction and mining equipment company, gaining 48 cents to $84.34. But the company warned that it expects lower profit and revenue for the rest of the year.



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