US stocks tank ahead of earnings reports

NEW YORK: US stocks tumbled Monday ahead of a raft of corporate reports as earnings season gets into full swing this week.

The Dow Jones Industrial Average shed 179.11 points (1.09 per cent) at 16,257.94.

The broad-market S&P 500 skidded 23.17 (1.26 per cent) to 1,819.20 and the tech-rich Nasdaq lost 61.36 (1.47 per cent) at 4,113.30.

Stocks opened modestly lower then traded near the flatline until midday, before steadily selling off all afternoon.
Traders were "likely playing their cards close to the vest before 4Q earnings season and the economic calendar kick into gear," Charles Schwab & Co. said in a market note.

On Tuesday, before markets open, JPMorgan Chase, the biggest US bank, and Wells Fargo will report earnings and the government will release data on December retail sales covering the important holiday shopping season.
Yoga apparel retailer Lululemon plunged 16.6 per cent after lowering its fourth-quarter revenue and earning guidance and highlighting it saw January sales and traffic trends "decelerate meaningfully."
Fashion retailer Express sank 4.6 per cent after lowering its fourth-quarter guidance and reporting weak January traffic to date.

General Motors fell 1.1 per cent after signalling it was close to resuming dividends, according to media reports. Its Chevrolet brand won the top car and truck of the year awards at the Detroit auto show.

In merger and acquisition news, Beam, the maker of Jim Beam bourbon, agreed to be acquired by Japan's Suntory Holdings for US$83.50 a share in a US$16 billion deal creating the spirit sector's third-largest player.

Beam skyrocketed 24.6 per cent to US$83.42.

Google slipped 0.6 per cent. After the market closed, the search giant announced it was buying Nest, a smart-home company that makes thermostats and smoke alarms, for US$3.2 billion in cash. Shares were up 0.5 per cent in after-hours trading.

Chinese search engine Qihoo 360 Technology rose 3.0 per cent after a Stifel upgrade from "hold" to "buy," saying "2014 is the year of significant search monetization for Qihoo, fuelling strong revenue growth and potential upside surprise."
Bond prices rose. The yield on the 10-year US Treasury slipped to 2.83 per cent from 2.86 per cent Friday, while the 30-year fell to 3.77 per cent from 3.80 per cent. Bond prices and yields move inversely.

- AFP/ac