Stocks fall; Twitter plunges
Stocks fell in afternoon trading Tuesday after mixed earnings results were reported by U.S. companies. Technology stocks dropped, led by a plunge in Twitter. Home builder stocks fell broadly on further signs of weakness in the housing market.
At the close on Wall Street, the Standard & Poor's 500 index dropped nearly 17 points, or 0.9 percent, to 1,867.7. The Dow Jones industrial average fell 129.5 points, or nearly 0.8 percent, to 16,401 points. The Nasdaq composite dropped 57.3 points, or nearly 1.4 percent, to 4,080.8.
THE QUOTE: "People are getting weary of the things-are-getting-better story," said Steven Ricchiuto, chief economist of Mizuho Securities. "We're hiring more workers, but we're not paying them more . . . and so you can only get a certain level of consumer spending, which is three-quarters of GDP."
TWITTER TUMBLE: The instant messaging service plunged $6.90, or 17.8 percent, to $31.85 after Twitter insiders were allowed to sell stock for the first time since the company's initial public offering in November. Netflix fell 5 percent, Facebook and Amazon fell 4 percent and Google fell 2 percent.
OFFICE DEPOT UP: The office supply chain gained 66 cents, or 15.4 percent, to close at $4.83 after reporting adjusted profits for the first quarter that were twice as high as analysts expected. The company also said it would close at least 400 U.S. stores after its merger with OfficeMax resulted in the overlap of retail locations.
INSURER WOES: American International Group closed down $2.18, or about 4 percent, at $50.54. The company reported revenue that was below what investors expected due to higher catastrophe losses and lower investment income. Financial stocks fell 1.3 percent, the biggest drop among the ten sectors of the S&P 500.
HOME PRICES: U.S. home prices rose at a slightly slower pace in the 12 months that ended in March, according to data provider CoreLogic. It's another sign that weak sales, caused in part by rising mortgage rates, have begun to restrain the housing market's sharp price gains. Home builder stocks fell broadly. Ryland Group fell $1.18, or 3 percent, to $37.50 and D.R. Horton fell 70 cents, or 3 percent, to $22.28.
MORE EXPORTS: The U.S. trade deficit narrowed in March as exports rose to the second highest level on record. Exports were led by gains in sales of aircraft, autos and farm goods. The deficit declined to $40.4 billion, down 3.6 percent from a revised February imbalance of $41.9 billion, the Commerce Department reported. The February deficit had been the biggest trade gap in five months.