NEW YORK (AP) — Stocks stumbled Wednesday as a rare earnings miss by Apple pulled down technology stocks. Indexes turned lower in late afternoon trading on reports of an impasse in talks aimed at resolving the European debt crisis.
The leaders of Germany, France, the International Monetary Fund and the European Central Bank met Wednesday to prepare for a European summit this weekend to find a solution to the region’s debt troubles. Rising and falling expectations for the meeting have rattled markets every day this week.
“The big theme this week is what’s going to happen in Europe over the weekend,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott. “If a Greece or another country defaults, it could do real damage to Europe. If that pushes Europe into a recession, it will further clip the pace of global growth.”
Apple Inc. slumped 5 percent after the company’s income and revenue fell short of forecasts. It was a rare miss for the company, which had jumped 31 percent this year through Tuesday. Apple blamed the shortfall on a later-than-usual release of its newest iPhone.
The Dow Jones industrial average was down 99 points, or 0.9 percent, 11,478 at 3:05 p.m. Eastern. The Dow had spent much of the day edging higher, led by Travelers Cos., a major insurer. Travelers jumped 5.8 percent after reporting revenue that beat analysts’ expectations.
The Dow’s second-best stock was Intel, which rose 3.2 percent. Intel Corp. said its net income rose 17 percent last quarter, beating Wall Street’s target.
Other technology stocks were lower. The Nasdaq composite slid 52, or 2 percent, to 2,604. The S&P 500 fell 16, or 1.3 percent, to 1,208.
Worries that Europe’s troubles could get worse have driven many of the market’s big swings lately. The Greek government is widely expected to go through some kind of default or restructuring of its debt. If that process becomes messy, European banks that hold Greek government bonds may find it difficult to raise money from other banks. That, in turn, could trigger a freeze in credit markets and deliver a blow to an already weak European economy.
Investors had plenty of corporate news to digest on Wednesday. Abbott Laboratories announced plans to spin off its drug business. Abbott’s stock rose 1 percent.
Large banks that were trading higher dropped in the late afternoon. Morgan Stanley fell less than 1 percent. The bank said a jump in investment banking revenue helped it earn $1.15 a share, well above analyst expectations of 30 cents per share.
Citigroup slipped 1.7 percent. The bank agreed to pay $285 million to settle civil fraud charges that it misled buyers of complex mortgage investments just as the housing market was starting to collapse.
BlackRock Inc. dropped 4.2 percent after the money management giant said its assets under management fell 3 percent.
Airlines fell. AMR Corp., the parent of American Airlines, slid 5 percent after reporting a loss that was worse than Wall Street analysts predicted. The company said its fuel spending jumped 40 percent, wiping out revenue gains from higher fares and fees. JetBlue Airways Corp. dropped 6.2 percent after the company said its chief financial officer has resigned.
American Express and eBay will report their results from the last quarter after the market closes.