Stocks fell on Tuesday after a disappointing outlook from 3M Co and a second straight month of falling domestic sales at McDonald's Corp triggered concern about consumer spending.
Equities also faced pressure from a climb in the U.S. dollar as investors sought safety from risk amid worries about Dubai's unresolved debt problems.
As the dollar rose, commodities, including oil and gold, fell.
Diversified manufacturer 3M
Shares of McDonald's
They are all squeezing margin, said Cummins Catherwood, managing director at Boenning and Scattergood in West Conshohocken, Pennsylvania.
I haven't seen much revenue improvement anywhere and until we get there, you can't become a believer.
The Dow Jones industrial average <.DJI> dropped 92.66 points, or 0.89 percent, to 10,297.45. The Standard & Poor's 500 Index <.SPX> fell 8.98 points, or 0.81 percent, to 1,094.27. The Nasdaq Composite Index <.IXIC> shed 8.81 points, or 0.40 percent, to 2,180.80.
The disappointing views overshadowed optimism late Monday from FedEx Corp
In another sign of weak consumer spending, supermarket operator Kroger Co
Kroger shares slumped 10.3 percent to $20.50 while the S&P Consumer Staples index <.GSPS> slipped 1.1 percent.
The greenback <.DXY> rose 0.4 percent against a basket of six other major currencies.
President Barack Obama's announcement of measures to create more jobs in the struggling recovery had little immediate impact on stocks. Obama proposed small business tax cuts, fresh infrastructure spending and energy efficiency rebates.
(Editing by Kenneth Barry)