Weak results at retailers drag US stocks lower

Weak results at retailers drag US stocks lower


AP Business Writer Major U.S. stock indexes edged lower in morning trading Tuesday, weighed down by several major retailers that reported disappointing earnings. Staples, Dick's Sporting Goods and Urban Outfitters were among the biggest decliners, while Home Depot bucked the trend.

KEEPING SCORE: The Standard & Poor's 500 index fell two points, or 0.1 percent, to 1,882 as of 11:17 a.m. Eastern Time. The Dow Jones industrial average shed 24 points, or 0.2 percent, to 16,487. The Nasdaq composite slid 10 points, or 0.3 percent, to 4,115.

RETAIL SWOON: Staples' profit plunged 43 percent; Dick's Sporting Goods fell short and pared its outlook; Discount retailer TJX had weak sales and Urban Outfitters reported lower-than-expected earnings as sales at its namesake chain declined.

"Normally these sort of earnings reports wouldn't have that much of a significant impact on the market, but with volumes pretty low and not much other news, that's what's pushing us down," said Erik Davidson, deputy chief investment officer at Wells Fargo Private Bank.

FIRE SALE: Staples plunged $1.55, or 11.6 percent, to $11.84 in morning trading. Dick's Sporting Goods fell $8.59, or 16.2 percent, to $44.59. Urban Outfitters slid $2.41, or 6.7 percent, to $33.77. TJX shed $3.66, or 6.3 percent, to $54.74.

HOUSING BET: Home Depot's adjusted earnings and revenue came in short of Wall Street's expectations. However a key sales metric improved, despite a slow start to the spring home-selling season caused by bad weather. The home improvement retailer also raised its full-year earnings forecast. Home Depot's stock rose $2.27, or 3 percent, to $78.77.

MORE RETAIL TURMOIL: Target fired the president of its troubled Canadian operations and replaced him with company insider Mark Schindele, who has been senior vice president of merchandising operations in the U.S. Target fell 93 cents, or 1.6 percent, to $57.36.

HEFTY CHARGE: Medtronic agreed to pay more than $1 billion to settle long-standing patent litigation with fellow medical device maker Edwards Lifesciences over replacement heart valves. A one-time charge stemming from the settlement contributed to a 54 percent plunge in Medtronic's earnings in its fourth fiscal quarter. Medtronic's stock fell $1.44, or 2.4 percent, to $58.90.

SECTORS: Nine out of the 10 sectors in the S&P fell, led by industrial stocks. Energy companies rose.

OVER THERE: European markets mostly fell. France's CAC 40 fell 0.3 percent and Germany's DAX gave up 0.1 percent. Britain's FTSE 100 lost 0.2 percent. Thailand's stock market slumped and its currency wobbled after the military declared martial law in what it called an attempt to stabilize the country's precarious political situation.

OTHER MARKETS: Bond prices rose. The yield on the 10-year Treasury note edged down to 2.53 percent from 2.54 percent late Monday. Gold fell 20 cents to $1,293.60 an ounce. Crude oil fell to $102.10 a barrel.

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