* Dow back under 17,000 in broad market decline
* Alcoa to report after market close; revenue seen down
* Internet names among weakest of the day
* Dow off 0.7 pct; S&P 500 down 0.7 pct; Nasdaq off 1.5 pct
(Updates to late afternoon, changes byline)
By Chuck Mikolajczak
NEW YORK, July 8 U.S. stocks fell in a broad
selloff on Tuesday, dropping for a second straight session as
investors showed caution ahead of the start of earnings season.
The benchmark S&P 500 index, however, recovered from earlier
lows and was hovering near its 14-day moving average. That would
be a sign of weak near-term momentum if the S&P declined below
that level by more than a slight amount. Nine of the 10 primary
S&P 500 sector indexes were lower, with only defensive groups
like utilities higher for the day.
About 60 percent of stocks trading on the New York Stock
Exchange fell, and more than three-fourths of Nasdaq-listed
"All the bubble talk eventually gets to people, and with
earnings facing us imminently, it's not a bad time to be a bit
more cautious," said Tim Ghriskey, chief investment officer of
Solaris Group in Bedford Hills, New York.
"We haven't seen a lot of pre-announcements and the ones we
have seen were pretty predictable, which probably means earnings
are not going to be bad, and they could surprise to the upside.
But we think the market is likely to take that a bit in stride
and remain a bit cautious here."
U.S. stocks have performed well recently, with major indexes
hitting repeated records and the Dow breaking above 17,000 for
the first time ever. The advance has largely come on the back of
strong data. Market participants are looking to earnings for
confirmation that the economy recovered in the second quarter
from the impact of a harsh winter.
In a caveat about consumers, Bill Simon, the chief executive
of Wal-Mart's U.S. division, told Reuters that while the
domestic job market was improving, that wasn't giving consumers
enough confidence to boost spending.
Alcoa Inc, among the first high-profile names to
report, will release results after the closing bell on Tuesday.
The aluminum producer is seen posting profit growth of more than
50 percent, according to Thomson Reuters data, along with a 3.6
percent drop in revenue. Its stock rose 0.5 percent to $14.81.
Profits of S&P 500 companies are expected to grow 6.2
percent in the second quarter, according to Thomson Reuters
data, down from the 8.4 percent growth forecast at the start of
April. Revenue is seen up 3 percent.
The Dow Jones industrial average fell 117.10 points
or 0.69 percent, to 16,907.11. The S&P 500 slid 14.73
points or 0.74 percent, to 1,962.92. The Nasdaq Composite
dropped 64.86 points or 1.46 percent, to 4,386.67.
The Dow fell back below the psychologically important 17,000
level. Small-cap stocks underperformed again, dropping for a
second straight day. The Russell 2000 fell 1.3 percent in
its biggest two-day drop since April.
Weakness in tech shares pressured the Nasdaq, with Internet
names especially hit hard. Netflix Inc fell 4 percent
to $442.21 while Facebook Inc dropped 4.1 percent to
$62.60. TripAdvisor Inc sank 5.6 percent to $101.39.
On the upside, NeuroMetrix Inc jumped 20.3 percent
to $2.28 after the U.S. Food and Drug Administration cleared the
company's wearable technology for over-the-counter use in the
treatment of chronic pain.
(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)