NEW YORK: Poor corporate earnings reports pounded the stock market Friday in a sour end to an otherwise strong week of trading. The Dow Jones industrial average fell more than 200 points for its worst day in four months.
Disappointing results from three giants of the Dow — Microsoft, General Electric and McDonald’s — were to blame. But the broader market fell, too, and the Standard & Poor’s 500 index fared even worse in percentage terms.
The Dow sank 205.43 points, or 1.5 percent, to close at 13,343.51. The S&P lost 24.15, or 1.7 percent, to 1,433.19. The Nasdaq composite index, hammered by a second ugly day for Google, lost 67.25 points to 3,005.62, a 2.2 percent decline.
The big drops Friday left the Dow and S&P clinging to gains for the week.
Financial analysts expect corporate earnings for July through September to be lower than the same period a year ago, which would be the first yearly decline in three years.
Through Thursday, with 115 companies in the S&P 500 reporting, earnings were down 3.7 percent compared with a year earlier, according to Thomson Reuters, a financial data provider, and ING, a financial company.
“And once you get one quarter of negative earnings, it’s a precursor,” said Doug Cote, chief market strategist at ING Investment Management in New York. “It’s the cockroach theory: If you find one, there’s probably many more.”
All 10 industry groups in the S&P 500 fell, led by technology and materials stocks.
