3M cuts 2011 earnings forecast; Delta fails to meet street expectations
By STAN CHOE, AP Business Writer
NEW YORK (AP) -- Poor reports on corporate earnings and American consumer confidence dragged stocks lower Tuesday. Worries about Europe's debt problems also pulled the market down after three days of gains.
Manufacturing conglomerate 3M cut its 2011 earnings forecast, and U.S. Steel warned that demand for its products could slow. Netflix Inc. plunged 36 percent after reporting that 800,000 subscribers ditched the service after it raised prices in July.
The Dow Jones industrial average was down 63 points, at 11,850, after the first hour of trading. That's a decline of 0.5 percent. The Dow had been down as many as 173 points ten minutes after the opening bell.
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The latest headlines from Europe cast doubt over whether leaders there can agree on a comprehensive solution for the region's debt crisis in time for a summit Wednesday. The market was also pulled lower after the Conference Board reported that its index of consumer confidence plunged to the lowest level since March 2009.
The S&P 500 index was down 9, or 0.8 percent, at 1,241. The Nasdaq composite fell 20, or 0.7 percent, to 2,679.
3M, the maker of Post-Its and Scotch tape, said its third-quarter earnings fell 2 percent. It also expects growth to remain slow through the year and it cut its 2011 earnings forecast. 3M slumped 4 percent, the most among the 30 stocks in the Dow average.
U.S. Steel plunged 5.5 percent after the nation's largest steelmaker warned that demand for some of its products could decline in the final three months of the year if the economy slows down more.
Delta Air Lines Inc. slumped 3.6 percent after the airline reported results that missed Wall Street's expectations. Delta cut its flights 1 percent in the most recent quarter and said it would cut as much as another 5 percent during the last three months of this year.
Increasing hope for a solution to Europe's debt mess and strong profit reports from Caterpillar Inc., McDonald's Inc. and other major U.S. companies helped the S&P 500 surge 14.1 percent from Oct. 3, when it slumped to its lowest point of the year, through Monday's close.
(Copyright 2011 by The Associated Press. All Rights Reserved.)