* Amazon.com shares tumble after earnings disappoint
* Wal-Mart cuts outlook due to store closings
* Dow off 0.5 pct; S&P 500 down 0.2 pct; Nasdaq off 0.1 pct
By Angela Moon
NEW YORK, Jan 31 U.S. stocks fell on Friday,
with the S&P 500 on track for its first monthly loss since
August as disappointing corporate earnings from big companies
like Amazon.com and concerns about the euro zone and emerging
markets kept investors on edge.
But the major stock indexes came well off their session lows
by afternoon, with the S&P 500 recovering from most of its loss.
"I think the shorts are taking off some risks, heading into
the weekend. It's been a decent couple of weeks for them, and
they are adjusting their positions as this week, this month
comes to an end," said JJ Kinahan, chief strategist at TD
Ameritrade in Chicago.
The Dow Jones industrial average fell 71.51 points or
0.45 percent, to 15,777.10. The S&P 500 declined 3.74
points or 0.21 percent, to 1,790.45. The Nasdaq Composite
dropped 5.764 points or 0.14 percent, to 4,117.361.
For the month of January, the S&P 500 was down 3.1 percent.
For the week, though, the index was flat in afternoon trading.
One of the biggest decliners of the day was Amazon.com Inc
, which fell 9.4 percent to $365.09 a day after the
world's biggest online retailer missed Wall Street's estimates
for the crucial holiday period. Amazon also cautioned investors
about a possible operating loss this quarter as shipping costs
Chevron Corp was the Dow's biggest decliner after
the second-largest U.S. oil company said its fourth-quarter
profit dropped 32 percent as refining margins and production
fell around the world. The stock was off 3.2 percent at $112.63.
Mattel Inc shares slid 13 percent to $37.43 after
the world's largest toy company reported a quarterly profit that
missed Wall Street's estimates.
Wal-Mart Stores Inc shaved its outlook for the
fourth quarter and full year to account for special items,
including those tied to store closures and the restructuring of
Sam's Club. The stock was up 0.5 percent at
$75.10 after trading in negative territory for most of the
Global equity markets have been rattled over the past week
by the outlook for emerging markets. A rout in emerging
currencies has spurred some central banks to raise interest
rates or intervene in markets to limit the swings, in turn
pressuring bond and stock holdings and forcing investors to
"Interest-rate increases from Turkey, India and South Africa
this week alone served to briefly spark vigor back into
investors' strides," said Andrew Wilkinson, chief market analyst
at Interactive Brokers LLC in Greenwich, Connecticut.
"However, the week is ending on a bad note as investors
reflect on the earlier catalyst indicating potential sluggish
growth for the world's No. 2 economy, China. Pressure has now
returned to haunt the key emerging market currencies whose
central banks have so far raised the cost of borrowing, but
pressure valves are also now being tested elsewhere."
Among other earnings, MasterCard Inc reported a 3
percent rise in quarterly profit but missed analysts' average
forecast as expenses rose. The stock fell 5.5 percent to $75.37.
Google Inc's quarterly revenue beat Wall Street's
target despite an ongoing decline in prices for its online ads
and deepening losses at Motorola, the handset-making division to
be sold to China's Lenovo. Google shares gained 3.8
percent at $1,178.53.
Zynga Inc shares jumped 19.5 percent to $4.26. The
company, known for its "Farmville" game, said late Thursday that
it will cut 15 percent of its workforce to slash costs and buy
mobile game developer NaturalMotion for $527 million to refresh
a stalled games pipeline.
EURO-ZONE AND U.S. DATA
Weighing on investor sentiment was data showing that
inflation in the euro zone slowed this month to 0.7 percent from
0.8 percent in December. That reading confounded expectations
for an increase to 0.9 percent and matched a low hit last
October. The European Central Bank responded by cutting its
interest rates to record lows.
An unexpected drop in euro-zone inflation raises pressure on
the ECB to consider fresh policy action next week to counter
deflation risks and support a weak euro-zone recovery that may
Meanwhile, U.S. consumer sentiment dipped slightly in
January, with recent economic improvement not translating into
expectations for future gains, according to Thomson
Reuters/University of Michigan data.
Another report showed U.S. labor costs rose in the fourth
quarter, but there was still little sign of wage inflation amid
slack in the job market.