Wall Street's rally skidded to a halt Monday after weaker-than-expected earnings from Citigroup raised questions about other companies' second-quarter results.
With two weeks of earnings reports ahead, Citigroup's profits punctured some of the optimism that lifted stocks last week. The nation's largest financial institution said challenging market conditions left its earnings below Wall Street expectations.
The Dow Jones industrial average fell 65.84, or 0.6 percent, to 10,574.99; the Standard & Poor's 500-stock index fell 6.79, or 0.6 percent, to 1221.13; and the Nasdaq composite index fell 11.91, or 0.6 percent, to 2144.87.
Although earnings are dominating the market this week, traders are also waiting for Federal Reserve Chairman Alan Greenspan to deliver his much-anticipated semiannual testimony on monetary policy before Congress on Wednesday and Thursday.
Citigroup fell $1.42, to $45. Its disappointing earnings contrasted with those of Bank of America, which released results that beat analysts' expectations by 5 cents a share. But Bank of America fell 90 cents, to $45.08, as investors focused on declining profit margins from the company's loans.
International Business Machines rose $3.53, to $85.34, in extended trading after announcing second-quarter earnings that surpassed forecasts. IBM reported its earnings after the close of regular trading, in which its shares fell 57 cents, $81.81.
MBNA, the world's largest credit card issuer, fell 37 cents, to $25.85. The company announced earnings that beat analysts' expectations but said a bulk of its cash volume growth for the quarter came from new cards with low introductory rates that could reduce future margins.
Guidant shares fell $2.10, to $67.31, after the company warned physicians that replacements might be needed for nine pacemaker models made between 1997 and 2000, of which about 28,000 remain implanted in patients worldwide.
Scholastic rose 28 cents, to $37.34, after announcing that a record 6.9 million new Harry Potter books sold in the first 24 hours of U.S. sales.
New York Stock Exchange composite index fell 31.15, to 7372.44.
American Stock Exchange index fell 5.13, to 1534.84.
Russell 2000 index of smaller-company stocks fell 5.18, to 658.56.
NYSE: 1.59 billion shares, down from 1.74 billion on Friday. Decliners outpaced advancers 3 to 2.
Nasdaq: 1.32 billion shares, down from 1.52 billion. Decliners outnumbered advancers 5 to 3.
Crude oil for August delivery: $57.32, down 77 cents.
Gold for current delivery: $420.40 a troy ounce, down from $420.70 on Friday.