US stocks end lower on mixed earnings

NEW YORK (AFP) - Wall Street stocks finished solidly lower on Wednesday following mixed earnings that included strong results from General Motors and disappointing figures from Yahoo.

After a volatile session, the Dow Jones Industrial Average ended down 48.50 points (0.28 per cent) to 17,168.61.

The broad-based S&P 500 fell 11.83 (0.58 per cent) to 2,018.94, while the tech-rich Nasdaq Composite Index dropped 40.85 (0.84 per cent) to 4,840.12.

Sam Stovall, equity strategist at S&P Capital IQ, said third-quarter earnings are coming in slightly better than expected, with analysts now projecting a 4.8 per cent decline in profits compared with an earlier forecast for 5.2 per cent fall.

"After jumping nearly 9 per cent since the Aug 25 closing low, the S&P 500 is taking some much-needed rest," Stovall said.

GM climbed 5.8 per cent after third-quarter net income translated to US$1.50 per share, much above the US$1.19 forecast by analysts.

Yahoo fell 5.2 per cent as the technology company reported net income at 15 cents per share, two cents below analyst expectations.

Flash memory specialist SanDisk rose 2.1 per cent on news it will be acquired by Western Digital for US$19 billion (S$26 billion). Western Digital fell 4.6 per cent.

Data storage company EMC fell 6.2 per cent after reporting that third quarter net income fell 15.8 per cent to US$528 million. Privately-held Dell has announced plans to buy EMC for US$67 billion.

Other companies to report earnings included Biogen (+4.0 per cent), Boeing (+1.7 per cent), Chipotle Mexican Grill (-5.7 per cent) and Coca-Cola (-0.2 per cent).

Valeant Pharmaceuticals International dived 19.2 per cent after a report from Citron Research accused the company of inflating its sales figures. Valeant said the allegations of fraudulent behaviour were "erroneous."

Endo International, another pharma company that, like Valeant, has grown via acquisitions, fell 13.3 per cent.

Italian supercar maker Ferrari finished at US$55 per share in its first trade in the New York Stock Exchange, up 5.8 per cent from its initial public offering price of US$52.

Petroleum producers fell as oil prices retreated. Dow member ExxonMobil lost 0.8 per cent, Apache shed 1.8 per cent and Devon Energy lost 3.9 per cent.

Bond prices rose. The yield on the 10-year US Treasury fell to 2.03 per cent from 2.07 per cent Tuesday, while the 30-year declined to 2.87 per cent from 2.92 per cent. Bond prices and yields move inversely.