Stocks fell Monday as Delphi's bankruptcy filing and lowered outlooks at Northrop Grumman and Xilinx set a gloomy tone on Wall Street ahead of the upcoming third-quarter earnings season.
The market extended last week's losses as investors grew anxious for earnings reports to gauge the impact of hurricanes Katrina and Rita, and to get a glimpse of where the economy is headed as companies forecast future results. Stocks took a hit after Northrop said the storms would hurt its 2005 profit, while chipmaker Xilinx pegged its sales below previous targets.
But the market received some good news after the close, when aluminum producer Alcoa posted a profit that beat analysts' forecasts despite pressure from soaring energy costs and lower aluminum prices.
Many traders took the Columbus Day holiday off. At the close of trading, the Dow Jones industrial average had fallen 53.55, or 0.5 percent, to 10,238.76, its lowest close since mid-May. The Standard & Poor's 500-stock index dropped 8.57, or 0.7 percent, to 1187.33. The Nasdaq composite index sank 11.43, or 0.5 percent, to 2078.92.
Delphi, the largest U.S. auto-parts supplier, on Saturday filed for bankruptcy after battling with soaring raw materials and labor costs. Delphi plunged 70.5 percent, to 33 cents, and former parent General Motors fell $2.81, to $25.48. Dana Corp., a Delphi rival, slid $3.15, to $6.04, after the company said it will restate past earnings to fix improper accounting and withdrew its profit estimates for the rest of this year.
Patterson Cos., a supplier of dental, veterinary and rehabilitation products, rose $1.95, to $39.96. Standard & Poor's said the company will replace Delphi in the S&P 500 index.
Northrop Grumman dropped 57 cents, to $53.48, after its earnings forecast.
Xilinx declined $4.35, or 16 percent, to $22.77.
IBM jumped 75 cents, to $81.25, after Citigroup upgraded the computer maker's shares to "buy" from "hold."
Wal-Mart Stores, the world's largest retailer, advanced 51 cents, to $44.54.
New York Stock Exchange composite index fell 49.62, to 7385.57.
American Stock Exchange index fell 23.83, to 1651.07.
Russell 2000 index of smaller-company stocks fell 6.36, to 637.97.
NYSE: 2.21 billion shares, up from 2.12 billion on Friday. Decliners outnumbered advancers 5 to 2.
Nasdaq: 1.41 billion shares, down from 1.47 billion. Decliners outnumbered advancers 9 to 5.
Crude oil for November delivery: $61.80, down 4 cents.
Gold for current delivery: $475.10 a troy ounce, up from $474.70 on Friday.