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Caterpillar steamrolls stocks Heavy equipment maker takes down the Dow as earnings fall short; stellar profits at Google can't overcome. NEW YORK (CNNMoney.com) -- Stocks fell Friday as Caterpillar shares plunged, overshadowing a soaring Google and dragging the Dow below the milestone 12,000 mark. The 30-share Dow (down 43.86 to 11,967.87, Charts) slipped 0.3 percent about an hour and a half into the session after initially opening higher.
Thursday the Dow closed above 12,000 for the first time, hitting a record high for the ninth time in the last 12 sessions. The broader S&P 500 (down 2.54 to 1,364.42, Charts) lost 0.2 percent while the tech-laden Nasdaq (down 6.14 to 2,334.80, Charts) also slipped about 0.2 percent. Caterpillar shares tumbled 12 percent after profits at the heavy equipment maker rose but fell short of estimates. The company, often viewed as a barometer for the broader economy, also warned of slower economic growth ahead. The big drop in share price accounted for all of the Dow's loss and then some - the benchmark index would be trading 20 points higher without the drag. Not even Internet gorilla Google could stem the slide. Google (up $29.66 to $455.72, Charts) soundly beat analyst estimates late Thursday as profits nearly doubled and the stock stock surged 7 percent early Friday. Several brokerages raised their price targets above $500 Friday morning. Other earnings reports were mostly positive. Conglomerate 3M (up $1.70 to $78.10, Charts) posted improved results that beat forecasts and its shares rose 2 percent. Profits fell at Merck & Co. (up $0.83 to $45.32, Charts) but the fall was attributed to the company setting aside an additional $598 million to fight lawsuits over its withdrawn painkiller Vioxx and shares rose over 1 percent. Oil turned lower after OPEC announced a 1.2 million barrel a day cut in production that analysts said it will have a hard time enforcing. U.S. light crude fell 75 cents to $57.75 a barrel on the U.S. Mercantile Exchange. Stocks in Asia closed mostly higher, while most gauges in Europe also rose. Treasury prices were little changed, leaving the the yield on the 10-year note near 4.78 percent. The dollar gained against the euro and the yen. Market breadth was negative. On the New York Stock Exchange, losers beat winners two to one on volume of 534 million shares. On the Nasdaq market decliners topped advancers two to one as 631 shares changed hands. _________________ |
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