Tech earnings, global worry drop Wall Street

By IBTimes Staff Reporter | January 28 2010 4:40 PM

Stocks dropped on Thursday as poor outlooks from Motorola and Qualcomm dented optimism in the technology sector while worries about Greece's fiscal health dragged on sentiment.

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Qualcomm Inc shares tumbled 14.2 percent to $40.48 and Motorola Inc slid 12.4 percent to $6.48 after both companies' earnings and outlooks fell short of expectations.

They did exactly what was supposed to happen with the type of earnings report that they had, said Jonathan Corpina, senior managing partner of Meridian Equity Partners in New York.

Several bellwethers this quarter have beaten modest expectations and still have been viewed unfavorably by the market, so these dismal reports were viewed even more negatively. The PHLX Semiconductor Index <.SOXX>lost 3 percent.

Investors are looking headline to headline to headline, Corpina added. It was China and bank reform last week. It was Obama's speech this week, and now today, it's Greece.

News that Athens will not be able to service its heavy debt unnerved investors and prompted them to shun riskier investments, including stocks, although the country's prime minister said it has not asked for a bailout.

Stocks added to losses following news that U.S. Federal Reserve Chairman Ben Bernanke was confirmed by the U.S. Senate, causing the benchmark S&P 500 to close below the key support level of 1,085.

The Dow Jones industrial average <.DJI> fell 115.70 points, or 1.13 percent, to end at 10,120.46. The Standard & Poor's 500 Index <.SPX> lost 12.97 points, or 1.18 percent, to 1,084.53. The Nasdaq Composite Index <.IXIC> declined 42.41 points, or 1.91 percent, to close at 2,179.00.

Manufacturer 3M Co , maker of Post-It notes and Scotch tape, fell 1.9 percent to $80.75 despite reporting stronger-than-expected earnings.

The global jitters overshadowed positive earnings from Dow component Procter & Gamble Co , which added 1.4 percent to $61.68 after its second-quarter earnings beat expectations and it raised its sales outlook for the year.

Earlier on Thursday, government data showed new orders for durable goods, or long-lasting manufactured goods such as washing machined and refrigerators, edged higher in December, and the number of workers filing claims for jobless benefits fell last week, signaling that the U.S. economy remains on the path to recovery.

(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)