US STOCKS-Wall St slips on weak results, but Boeing rallies

Reuters

* Caterpillar falls after results, chipmakers also drop

* Boeing rise curbs Dow's decline on higher full-yearoutlook

* China may tighten cash supply to address inflation risks

* Indexes off: Dow 0.5 pct, S&P 0.5 pct, Nasdaq 0.6 pct

By Ryan Vlastelica

NEW YORK, Oct 23 (Reuters) - U.S. stocks fell on Wednesdayas shares of Caterpillar and a number of chipmakers tumbled inthe wake of results, putting the S&P 500 on track to snap afour-session streak of record highs.

The earnings of two Dow components underlined how mixed thecorporate reporting season has been, with investors concernedabout revenue growth and company forecasts.

Caterpillar Inc was one of the biggest decliners onthe S&P, slumping 6 percent to $83.83 after the heavy-equipmentmachinery maker cut its full-year outlook for a third time andits profit missed expectations. That sent shares tumbling bytheir most in a day since September 2011.

On the upside, Boeing Co surged 4.1 percent to$127.50 after reporting a rise in adjusted profit and raisingits full-year forecast.

"We've seen a mixed bag as far as earnings go, andcomparisons will only get harder next quarter," said JerryVillella, investment specialist for JP Morgan Private Bank inDallas. "You have to be more careful about where you invest. Wehave more modest expectations going forward."

About a third of S&P 500 companies have reported thus far,with 66.3 percent topping profit expectations, a rate that isslightly higher than the historical average. Roughly 54 percenthave beaten on revenue, below the 61 percent long-term average.

Villella, who helps oversee about $935 billion in assets,said some sectors, like financials, were proving to be strong,"though technology is a bifurcated story."

Semiconductor stocks dropped 3 percent a day afterBroadcom, Altera and RF Micro Devices joined Intel and Texas Instruments on a list ofsemiconductor companies that have unveiled underwhelmingquarterly forecasts this past week.

Broadcom shares fell 1.6 percent to $26.72, Altera lost 13percent to $32.52 and RF Micro lost 8.3 percent to $5.65.

The Dow Jones industrial average was down 68.99points, or 0.45 percent, at 15,398.67. The Standard & Poor's 500Index was down 9.14 points, or 0.52 percent, at 1,745.53.The Nasdaq Composite Index was down 25.14 points, or0.64 percent, at 3,904.43.

The S&P 500 closed at an all-time high on Tuesday, itsfourth straight record. Its 23 percent gain on the year toTuesday was just shy of its 23.5 percent advance in 2009, theindex's best year over the past decade.

Global equity markets weakened Wednesday as China's primaryshort-term money rates rose on concerns the People's Bank ofChina may tighten its cash supply to address inflation risks,which could hurt growth in the world's second-largest economy.Shanghai shares fell 1.3 percent.

Further hurting sentiment, the European Central Bank said itwould put top euro zone banks through rigorous tests next yearto build confidence in the sector. Some analysts said that ifthe review reveals unexpectedly large problems, investorconfidence could be undermined.

The S&P financial sector index fell 0.8 percent.Among the European banks traded on U.S. exchanges, Barclays Plc fell 2.1 percent to $17.34 and Deutsche Bank lost1.8 percent to $49.48.

A unit of Samsung Electronics could become thebiggest shareholder of Corning Inc, the maker ofscratch-resistant Gorilla Glass used in many mobile gadgets.Corning shares jumped 12 percent to $17.22.

Shares of Cree Inc fell 15 percent to $63.25 afterthe maker of light-emitting diodes forecast current-quarterearnings below analysts' estimates.

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