Summary: Stocks were beat down for a second day in a broad-based sell off, but tech stocks were hit hardest as investors worry equity prices are too high heading into earnings season. Alcoa beats forecasts. Conway G. Gittens reports.
Wall Street crumbles with stocks near record highs as earnings season begins. After the close, Alcoa beat sales and profit forecasts excluding items. Corporate profits, as a whole, are expected to show a gain of 6.2 percent for the quarter, according to Thomson Reuters data. As for the trading day, the Dow and the S&P 500 shed seven-tenths of a percent drop in a month, and the Nasdaq suffered its worst defeat since late April. Investors fret tech stocks, and the whole market for that matter, are priced for perfection when it comes to earnings. Case in point: Pandora. The streaming music provider now has to defend its turf from big spenders like Google and Apple. The stock down more than seven percent. Other Internet names like Twitter, Yelp, and LinkedIn - were not far behind. A top Wal-Mart executive says the labor market may be improving, but he's not seeing that translate into an improvement in sales. The head of the Wal-Mart's U.S. division says consumers still lack the confidence needed to boost spending. In a sit down interview he described the environment as "not getting any better, but it's not getting any worse - at least for the middle class and down." Wal-Mart, shares, surprisingly bouncing higher less than one percent amid a sea of red. Check out shares of Delta Air Lines. The stock has plunged roughly 9-1/2 percent since the start of the month when the airline said an important sales measure rose less than expected. That's been followed up by a warning out of Europe. Air France-KLM says there are too many flying seats and that is hurting ticket prices. The warning contributed to a more than one percent market drop in Germany, France, and the UK. Finally, a rare loss in the U.S. fight against insider trading. Rengan Rajartnam, younger brother of convicted investor Raj Rajartnam, found - not guilty of conspiring to engage in insider trading.