NEW YORK (CNNfn) - The major U.S. stock indexes tumbled to 10-week lows Friday after a batch of high-profile profit warnings snuffed hopes for a quick economic turnaround.
EMC, the data storage leader, chipmaker Advanced Micro Devices, and BMC Software all said earnings in the latest quarter will fall sharply below forecasts.
"Unfortunately, earnings growth expectations are still too high," Marshall Acuff, equity strategist at Salomon Smith Barney, told CNNfn's Street Sweep. "We continue to learn about that."
The latest data job market figures made matters worse. Unemployment rose in June and employers shed jobs, the government said, as companies faced with slowing sales cut costs.
EMC, BMC and Advanced Micro join more than 80 companies pre-announcing shortfalls this holiday-shortened week. The latest warnings forced analysts to downwardly revise forecasts for the second quarter, which already was expected to be the worst period for earnings in a decade.
"There's really not much to be happy about today," David Briggs, head of equity trading at Federated Investors, told CNNfn's The Money Gang.
The Nasdaq composite index fell 75.95 points, or 3.7 percent, to 2,004.16, for its fourth straight loss and its worst finish since April 17, when the index closed at 1,923.22.
For the week, the Nasdaq fell 7.2 percent, widening its year-to-date loss to 18.8 percent.
The Dow Jones industrial average dropped 227.18, or 2.2 percent, to 10,252.68. Losses in 27 of the 30 Dow stocks handed the blue chip index its lowest close since April 17, when it ended at 10,216.73.
The Dow shed 2.4 percent on the week, pushing its 2001 decline to 5 percent.
The S&P 500 – which includes EMC, BMC and AMD – declined 28.65, or 2.6 percent, to 1,190.59. Off 9.8 percent on the year, the S&P 500 shed 2.8 percent on the week.
Investors found few places to hide. Treasury securities edged higher as did utility stocks.
More stocks fell than rose in light volume typical of a summer Friday. On the New York Stock Exchange, declining issues topped advancing ones 2,061 to 1,030 as 1 billion shares traded. Nasdaq losers beat winners 2,514 to 1,153 as 1.4 billion shares changed hands.
In the currency market, the dollar fell against the euro and held steady versus the yen.
More shortfalls
Just last week, Wall Street was banking on a profits recovery by the end of the year. But a steady diet of discouraging corporate news may delay any turnaround.
Advanced Micro Devices (AMD: down $7.84 to $20.80, Research, Estimates) said it expects to report that second-quarter profit fell as much as 88 percent below expectations. The selling spilled into Intel (INTC: down $1.41 to $28.43, Research, Estimates) , the No. 1 chipmaker.
EMC (EMC: down $8.43 to $21.60, Research, Estimates), the data storage leader, warned that its second-quarter profit could miss forecasts by as much as 77 percent. Rival Network Appliance (NTAP: down $0.89 to $11.78, Research, Estimates) also suffered.
BMC Software (BMC: down $2.07 to $20.68, Research, Estimates) said profit in its fiscal first quarter could miss forecasts by 50 percent.
In other disappointments, Tekelec (TKLC: down $6.74 to $18.11, Research, Estimates), which makes communications systems, said the economic slowdown will hurt sales and profit in the quarter ended last month.
The losses continued for Marconi (MONI: down $0.30 to $3.05, Research, Estimates). Shares of the British telecom equipment maker fell more than 50 percent Thursday on a profit warning.
"I think we have a lot more (warnings) to come in the coming weeks," Ross Margolies, portfolio manager at Salomon Brothers Asset Management, told CNNfn's Street Sweep.
Twenty-three of Nasdaq's 25 most actively traded stocks fell. But it wasn't only tech firms facing problems. Harrah's Entertainment (HET: down $6.15 to $29.64, Research, Estimates), the Las Vegas-based casino operator, pre-announced disappointing numbers.
"The catalyst for the upside is that these companies really need to start beating earnings estimates," Charles Payne, head analyst at Wall Street Strategies, told CNNf's Before Hours. "Cash is king, and I think patience is important now."
Some encouraging numbers surfaced. Alcoa (AA: down $0.98 to $39.80, Research, Estimates) became the first Dow component to report June quarter results, with the aluminum producer saying second-quarter profit rose to 49 cents a share excluding one-time items. That topped forecasts of Wall Street analysts, who expected 45 cents a share profit.
But the day's biggest upside surprise belonged to Interstate Bakeries (IBC: up $3.27 to $20.55, Research, Estimates). The maker of Twinkies snack food said its fourth-quarter earnings per share more than doubled.
Investors also moved into utility stocks. The Dow Jones utility average rose 2.61 points to 369.11.
Labor market weakens
More people are chasing fewer jobs, the latest government data showed.
The U.S. economy lost 114,000 jobs in June, the Labor Department said, nearly three times more than analysts' forecasts. Unemployment edged higher, to 4.5 percent from 4.4 percent in May.
The Federal Reserve cut interest rates six times this year to keep the economy from recession. Steven Wood, chief economist at FinancialOxygen.com said the latest job numbers support calls for another rate cut when central bankers meet again in August.
"The (Fed) may slow the pace of easing but they cannot stop yet," Wood said.
Those cumulative Fed rate cuts have not helped stocks yet. The major indexes are all down since Jan. 3, when the Fed began cutting rates. 
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