U.S. stocks declined in early trade on Thursday with tech stocks particularly remaining weak as weaker-than-expected sales and revenue forecast from Cisco Systems weighed on the sentiment.
The S&P 500 Index declined 10.48 points, or 0.86 percent, to trade at 1,207.95 at 10:05 a.m. EDT. The Dow Jones Industrial Average declined 96.80 points, or 0.85 percent, to trade at 11,260.24. The Nasdaq Composite Index dipped 1.66 percent.
Cisco Systems led the declines in the tech sector after reporting weaker-than-expected sales and revenue forecast for the second quarter and fiscal 2011 in the after-hours session on Wednesday. The company shares plunged 16.37 percent.
Cisco expects second quarter sales to grow 3 percent to 5 percent year-over-year, implying sales of $10.11 billion to $10.31 billion, lower than analysts' forecast of $11.08 billion. The company expects fiscal 2011 to grow 9 percent to 12 percent, implying sales of $43.64 billion to $44.84 billion, lower than analysts' guidance of $45.28 billion.
Among the Dow components, IBM fell 1.84 percent and Intel declined 1.38 percent, while HP and Microsoft declined more than 2 percent.
Siemens shares advanced 1.17 percent in NYSE as the company's fourth quarter earnings beat analysts' estimates and raised its 2011 outlook.
Investors are also monitoring the direction of talks at the G20 summit which got under way today, where the focus is on current account imbalances and currency valuations.
The euro declined 0.85 percent to 1.3665 against the dollar over renewed sovereign debt concerns in Portugal and Ireland and the yen declined 0.25 percent against the greenback.
Copper futures gained 1.65 percent as China’s debt rating raised by Moody’s Investors Service to Aa3 from A1 and record-high China inflation buoyed sentiment.
Chinese consumer prices accelerated to 25-month high in October, adding to expectations that the government will step up tightening measures by raising interest rates. Chinese consumer price index (CPI), a major gauge of inflation, rose to 4.4 percent in October compared with 3.6 percent in September.
European stock markets declined on Thursday as renewed sovereign debt worries offset encouraging earnings from Siemens and BT Group. Markets are currently trading lower with FTSE 100 down by 11.87 points, DAX30 down by 6.49 points and CAC 40 down by 27.92 points.