U.S. stocks fell in a broad decline on Tuesday, with the Dow seeing outsized losses after several blue chip components' results pointed to weakening conditions, while an unexpected decline in durable goods orders also weighed on sentiment. Tech shares were the big drag on the day, falling 2.4 percent in their biggest one-day drop since October, in the wake of results from industry bellwether Microsoft. Industrial shares also underperformed, led by a decline in Caterpillar. Microsoft fell 8.5 percent to $43 a day after the main engine of its historic earnings power - selling Windows and Office to big businesses - showed signs of waning.
A gauge of U.S. business investment plans fell for a fourth straight month in December, a potential sign that slowing global growth and falling oil prices were weighing on the economy. "The drop in (capital spending) will weigh on growth, though stronger consumer spending should keep GDP from slowing too much," said Chris Low, chief economist at FTN Financial in New York. The Commerce Department said non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, dropped 0.6 percent last month after a similar decline in November. Economists, who had expected a 0.5 percent gain, said the surprise drop last month likely reflected weak overseas demand for a wide range of capital goods and declining demand at home for energy-related equipment.
By Chuck Mikolajczak and Sinead Carew NEW YORK (Reuters) - A slew of U.S. multinational companies from DuPont to Microsoft Corp showed that a strong U.S. dollar is hammering their earnings, with several blue chip exporters predicting the situation will get worse if the greenback holds its strength. All told, the resurgent U.S. currency could shave up to $12 billion off U.S. companies' fourth-quarter 2014 revenue alone, according to currency expert Wolfgang Koester, the chief executive of FireApps, a data analytics company in Phoenix, Arizona that examines quarterly reports for currency related losses. The pain is hitting multiple sectors including industrial companies such as DuPont and 3M Co , technology companies like Microsoft Corp and Apple Inc (set to report its earnings after Tuesday's market close), airlines such as American Airlines Group Inc and healthcare companies including Bristol-Myers Squibb Co and Pfizer Inc - all companies that garner a large portion of their sales from outside the United States.