RTTNews - Stocks moved lower at the start of trading on Tuesday, with the major averages giving back some ground after ending the previous session at multi-month highs. Profit taking contributed to the initial weakness in the markets.
With traders reacting negatively to quarterly results from Centex (CTX) and Pulte Homes (PHM), housing stocks are turning in some of the worst performances in early trading.
Pulte Homes reported a second quarter net loss of $0.74 per share, compared to a net loss of $0.63 per share in the same period last year. Analysts had expected the company to report a loss of $0.57 per share for the quarter.
Pulte said total revenues for the quarter fell to $678.58 million from $1.62 billion in the prior year quarter. Analysts had consensus revenue estimate of $647.07 million.
Meanwhile, Centex reported first-quarter net earnings of $0.68 per share, compared to a loss of $1.21 per share in the same quarter of last year. Total revenues were $574 million, down 49 percent from $1.13 billion in the year ago quarter.
Pulte and Centex shareholders are expected to vote on a merger between the two companies on August 18th after Pulte offered to buy Centex for $1.3 billion in stock in April. The move would create the largest homebuilder in the U.S.
While oil service, banking, and electronic storage stocks are also posting notable losses, some strength in the biotechnology and airline sectors has helped to limit the downside for the markets.
On the economic front, the Commerce Department released a report showing that personal spending increased by slightly more than expected while personal income fell by more than expected.
Subsequently, the report said that personal saving as a percentage of disposable personal income was 4.6 percent in June compared with 6.2 percent in May.
In the past few minutes, the major averages have bounced off their lows for the young session, although they remain stuck in the red. The Dow is currently down 18.89 at 9,267.67, the Nasdaq is down 9.43 at 1,999.18 and the S&P 500 is down 4.54 at 998.09.
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