Caterpillar, Apple drag Wall Street lower

NEW YORK (Reuters) - The S&P 500 suffered its worst day since June on Tuesday, pulled lower by Caterpillar Inc after it cut its profit outlook, the latest high-profile company to expect growth will fall short of expectations.

Technology shares came under pressure after a second day of weakness for Apple Inc , the world's most valuable public company. Shares fell 2.5 percent to $673.54 as the company sold out of its initial supply of the new iPhone, raising concerns about keeping up with demand.

Caterpillar, the heavy equipment maker, said on Monday sluggish global growth was responsible for reduced estimates. Other companies to recently cut expectations include FedEx Corp and Norfolk Southern .

Shares of Caterpilar were the biggest weight on the Dow for a second day and ended down 4.2 percent at $87.01. That was the stock's biggest daily percentage drop since May.

The declines Tuesday reversed earlier gains attributed to portfolio "window dressing" as the quarter ends. Stronger-than-expected figures on U.S. consumer confidence also contributed to temporary gains.

This is "a market that has rallied and climbed a wall of worry. Right now the market is getting skittish and looking for reasons for buyers to be less aggressive," said Jim Fehrenbach, head of equity distribution at Piper Jaffray in Minneapolis.

The Dow Jones industrial average was down 101.37 points, or 0.75 percent, at 13,457.55. The Standard & Poor's 500 Index was down 15.30 points, or 1.05 percent, at 1,441.59, its fourth day of losses. The Nasdaq Composite Index was down 43.06 points, or 1.36 percent, at 3,117.73.

It was the S&P 500's biggest percentage daily loss since June 25 and the biggest for the Nasdaq since July 20.

The S&P 500 is up 2.5 percent so far in September, historically a difficult month for the market, and recently hit the highest level in nearly five-years.

For the quarter the S&P is up 5.8 percent so far, with gains largely tied to the latest moves by the European Central Bank and the U.S. Federal Reserve to stimulate their economies.

San Francisco Fed President John Williams said on Monday he expected the central bank to expand its bond-buying program next year to more aggressively combat the unemployment rate, but Philadelphia Fed President Charles Plosser countered on Tuesday the latest monetary stimulus will not do much to boost economic growth or lower unemployment.

Economic data from the Conference Board showed U.S. consumer confidence jumped to its highest in seven months in September.

Two separate reports showed home prices rose for another month in July, though the gains were not as strong as the previous month.

Red Hat dropped 4.3 percent to $55.08 after the world's largest distributor of Linux operating software reported a lower-than-expected adjusted profit and lowered the top end of its full-year revenue outlook.

(Additonal reporting by Atossa Abrahamian; Editing by Kenneth Barry)

Source: http://news.yahoo.com/wall-st-loses-ground-strong-quarter-nears-end-201940904--finance.html

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