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NEW YORK (CNN/Money) -
Stocks slumped Tuesday, erasing the previous session's rally, as worries about earnings and economic growth trumped any upbeat corporate news.
The Nasdaq composite (down 23.34 to 1,927.44, Charts) lost 1.2 percent.
The Dow Jones industrial average (down 91.34 to 10,151.13, Charts) and the broader Standard & Poor's 500 (down 10.36 to 1,151.74, Charts) index both lost around 0.9 percent.
"Today's weak market performance is the result of some worse-than-expected earnings reports and a decline in the consumer confidence report," said Michael Sheldon, chief market strategist at Spencer Clarke.
Sheldon said that the major gauges have also been facing something of an uphill battle over the last few days after falling through key technical support levels, which usually brings more selling.
Stocks gyrated through the morning as investors fretted over earnings misses from DuPont, Lexmark and a few European chipmakers, and tried to scrutinize the economic news, including a drop in consumer confidence. Declines accelerated in the afternoon.
A stronger new home sales report failed to reassure investors worried about slowing economic growth in that it seemed to indicate that there may be a housing sector bubble soon to pop.
"I think this choppiness is definitely going to continue over the next few months," said Tom Schrader, managing director of U.S. equity trading at Legg Mason. "The Street is very indecisive about what the economy is going to do, what the Fed is going to do."
He noted that while a lot of the earnings have either met or topped forecasts, market sentiment remains mixed, due perhaps to a sense that this may be as good as it gets for a while for earnings.
After the close, Amazon.com (Research) reported earnings and sales that met analysts estimates and issued a current-quarter forecast that is roughly in line with estimates. However, shares slipped five percent after the close with investors focusing on the negatives, including projection for weaker year-over-year operating income in the second quarter. (For more on Amazon.com's earnings, click here.)
Earnings reports due early Wednesday include Boeing (Research), Colgate-Palmolive (Research), ConocoPhilips (Research) and Dow component Verizon Communications (Research).
The March read on durable goods orders is also due before the open. Orders likely rose 0.3 percent in the month, according to a consensus of economists surveyed by Briefing.com. Orders rose 0.5 percent last month.
On the move
Losses covered an array of sectors, with 26 out of 30 Dow issues falling.
Tech was hit particularly hard, amid some disappointing earnings.
Computer printer maker Lexmark (down $11.05 to $67.70, Research) reported quarterly earnings that rose from a year earlier, but missed estimates. The company also issued a weaker-than-expected second-quarter forecast.
Lexmark shares slumped and weighed on PC makers Dell (down $1.19 to $35.52, Research) and Hewlett-Packard (down $0.63 to $20.47, Research).
Amazon.com shares fell prior to its after-hours earnings release, and weighed on eBay (down $0.41 to $31.14, Research), Yahoo! (down $0.49 to $35.00, Research) and others. The Goldman Sachs Internet (Charts) index fell 1.9 percent.
Chips were mostly weaker, after European chipmaker Infineon Technologies (down $0.35 to $8.83, Research) reported a wider-than-expected quarterly loss and issued a disappointing outlook.
Countering that was U.S.-based chipmaker Altera (up $1.35 to $20.60, Research), which reported higher-than-expected quarterly earnings late Monday, aided by a lower tax rate.
The Philadelphia Semiconductor index (down 2.82 to 388.62, Charts), or the SOX, fell 0.7 percent, after having sported a gain of 1.5 percent in the early afternoon.
Dow component DuPont (down $1.55 to $47.03, Research) fell more than 3 percent after it reported earnings of 96 cents per share, up from a year earlier, but a nickel short of expectations.
Fellow component American Express (up $0.58 to $51.55, Research) reported earnings of 75 cents per share during the session, in line with estimates and up from 66 cents a year ago. The stock gained just over 1 percent and was one of the few Dow gainers.
IBM (up $0.82 to $75.43, Research) also rose 1 percent after boosting its quarterly dividend by 11 percent to 20 cents per share. The tech leader's board also approved an additional $5 billion to be used for its stock buyback program.
Genentech (up $3.12 to $72.55, Research) rallied on news that its breast cancer drug Herceptin improved survival for certain women in the early stages of the disease. The No. 1 biotech announced the findings after the close Monday.
Market breadth was negative. On the New York Stock Exchange, losers beat winners eleven to five on volume of 1.56 billion shares. On the Nasdaq, decliners topped advancers by the same margin on volume of 1.70 billion shares.
Home sales up, confidence drops
New home sales rose to a 1.43 million unit annual rate in March, according to a government report released around 30 minutes after the start of trading. Sales stood at an upwardly revised 1.275 million unit annual rate in February. Economists thought sales would fall to a 1.190 million unit annual rate in the month.
That upbeat report was countered by a drop in consumer confidence.
Consumer confidence slipped to 97.7 in April from an upwardly revised 103.0 in March, according to a report from the Conference Board released around 30 minutes after the start of trading. Economists surveyed by Briefing.com thought the index would fall to 98 following a month of higher oil prices and a weaker stock market.
U.S. light crude oil for June delivery fell 37 cents to settle at $54.20 a barrel on the New York Mercantile Exchange, more than a dollar above its low of the session.
Treasury prices fell, raising the 10-year note yield to 4.26 percent from 4.25 percent late Monday. Treasury prices and yields move in opposite directions.
In currency trading, the dollar rose versus the euro and the yen.
COMEX gold added $3.20 to settle at $439 an ounce.
In global trade, Asian-Pacific markets ended mixed and European markets ended lower.
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