U.S. stocks tumbled Tuesday morning, with the Dow Jones Industrial Average falling the most since October, as a drop in durable-goods orders and disappointing results from Caterpillar Inc. to Microsoft Corp. heightened concern about the economy’s strength.
Technology shares in the Standard & Poor’s 500 Index fell the most since 2011. Microsoft lost 9.9 percent as software-license sales to businesses were below forecasts. Caterpillar plunged 7.3 percent after forecasting 2015 results that trailed estimates as plunging oil prices signal lower demand from energy companies. DuPont Co. dropped 2.8 percent as a stronger dollar cuts into the chemical maker’s profit. Procter & Gamble Co. and United Technologies Corp. declined at least 2 percent after saying the surging greenback will lower full-year earnings.
“Currency headwinds, as well as evidence of a continual deceleration of global growth, is having a major impacts on quarterly results,” Chad Morganlander, a money manager at St. Louis-based Stifel, Nicolaus & Co., which oversees about $160 billion, said in a phone interview. “Coupled with that, durable goods orders were somewhat disappointing, which scotches any optimism for today’s trading session.”
The Standard & Poor’s 500 Index slipped 1.6 percent to 2,024.38 at 11:01 a.m. in New York, below its average price for the past 50 days. The Dow declined 362.23 points, or 2.1 percent, to 17,316.47. Trading in S&P 500 companies was 27 percent above the 30-day average for this time of the day.
Wall Street began a full day of trading despite a snow storm that shut down travel around New York City overnight and during part of the morning.
Exchanges remained open despite the storm that hit the New York region. The last time snow prompted the New York Stock Exchange to shut down was in 1996, according to the exchange’s website.
With overnight travel bans in New York, where more than 160,000 securities industries professionals work, exchanges and the firms that rely on them expected to run on skeleton staffs and divert work to offices where weather is better.
The travel ban came to an end on Tuesday morning and the subway service was due to resume after the storm brought less snow than had been forecast.
Orders for business equipment unexpectedly fell in December for a fourth month, signaling a global growth slowdown is weighing on American companies. Bookings for non-military capital goods excluding aircraft dropped 0.6 percent for a second month, data from the Commerce Department showed. Demand for all durable goods – items meant to last at least three years – declined 3.4 percent, the worst performance since August.