By Yashaswini Swamynathan
REUTERS - U.S. stocks fell further in midday trading on Tuesday as corporate heavyweights Goldman Sachs and Johnson & Johnson disappointed investors with their quarterly results, while geopolitical tensions continued to weigh on market sentiment.
The S&P 500 healthcare sector fell 1.4 percent, dragged down by a 3.4 percent decline in Johnson & Johnson after the company's quarterly revenue fell short of analysts' expectations.
Goldman Sachs sank 4.6 percent after a rare profit miss due to weak trading revenue. The bank dragged down other financial stocks and shaved 73 points off the Dow.
Goldman is set to record its worst day since June 24, a day after Britain voted to leave the European Union.
Although Bank of America reported a better-than-expected profit, its shares reversed course to trade slightly lower, falling in line with the broader market.
"The news out this morning is earnings-related, but with concerns of the Trump agenda being pushed out a little bit and with the geopolitical tensions, this is not the kind of news you needed and it gives people a reason to not be buyers of the overall market," said Robert Pavlik, chief market strategist at Boston Private Wealth.
A rough start to the earnings season could add to investor concerns about market valuations, especially after a strong post-election rally drove major indexes to record highs.
Markets are also worried about President Donald Trump's ability to quickly implement pro-growth policies such as tax cuts, in the wake of a failed healthcare reform bill.
U.S. Treasury Secretary Steven Mnuchin warned that tax reforms could be delayed following the healthcare bill setback.
At 12:28 p.m. ET (1628 GMT), the Dow Jones Industrial Average was down 141.85 points, or 0.69 percent, at 20,495.07, the S&P 500 was down 11.02 points, or 0.47 percent, at 2,337.99 and the Nasdaq Composite was down 24.07 points, or 0.41 percent, at 5,832.72.
Safe-havens continued to be in favor ahead of crucial presidential elections in France, rising tensions between the United States and North Korea and the possibility of snap elections in Britain.
Nine of the 11 major S&P sectors were down. The only ones to gain were consumer staples and utilities, whose slow but steady growth makes them attractive during periods of uncertainty.
Netflix, the first of the FANG stocks to report results, was down 2.2 percent at $144.01 after the video streaming services provider reported weaker-than-expected subscriber numbers in the first quarter.
One bright spot was UnitedHealth, whose shares rose about 1 percent after the health insurer reported better-than-expected quarterly results and raised its profit and revenue forecasts for the year. The stock provided the biggest boost to the S&P and the Dow.
Declining issues outnumbered advancers on the NYSE by 1,933 to 915. On the Nasdaq, 1,892 issues fell and 820 advanced.
The S&P 500 index showed 16 52-week highs and two lows, while the Nasdaq recorded 28 highs and 42 lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)
Disclaimer: No Business Standard Journalist was involved in creation of this content
