U.S. stocks dropped on Tuesday, as disappointing data on the housing market outweighed strong earnings from bellwethers Apple and Caterpillar.
New construction of U.S. homes rose less than expected in September, while U.S. producer prices posted an unexpected decline, largely on falling energy prices.
U.S. stocks have risen steadily as S&P 500 companies have largely exceeded earnings expectations. The S&P 500 was up 5.5 percent in the last 10 trading days, but ran into resistance on Tuesday despite a number of solid reports.
There's a lot of profit-taking going on right now, said John Massey, portfolio manager at AIG SunAmerica Asset Management in Jersey City, New Jersey.
People have decided that this earnings season will largely be favorable, but that brings up the question of what the next catalyst will be for the market.
Caterpillar's stock gained 2.4 percent to $59.24.
Caterpillar was the Dow's <.DJI> best performer, even as the industrial average dropped 80.86 points, or 0.80 percent, to 10,011.33. The Standard & Poor's 500 Index <.SPX> fell 9.28 points, or 0.85 percent, to 1,088.63. The Nasdaq Composite Index <.IXIC> slid 20.28 points, or 0.93 percent, to 2,156.04.
Apple shares gained 4.6 percent to $198.56, while TI was up 1.5 percent at $23.87.
Caterpillar was one of five Dow components to report. Among the others, United Technologies Corp
Both Coca-Cola Co
Also weighing on stocks was crude oil, which fell after eight straight trading days of gains as the NYMEX November crude contract approached expiration. The NYMEX front-month crude contract slid 86 cents, or 1.1 percent, to $78.75 a barrel.
(Editing by Jan Paschal)