By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks fell hard on Wednesday as
an Apple Inc. supplier gave a weak forecast, Bank of America Corp.
posted disappointing results and speculation swirled that Germany
could lose its triple-A rating.
"In this environment you don't want to miss, you want to beat
and guide higher," said Phil Orlando, equity strategist at
Federated Investors, citing Intel Corp. and Bank of America's
quarterly earnings reports.
In addition, unsubstantiated talk involving Germany, the euro
zone's largest economy, hammered German stocks, with the U.S.
market following suit.
"Our desk identified some tweet or something that hit at four
this morning that suggested that Germany's government finances were
under review for a possible downgrade," said Orlando.
"We don't know if this is legitimate, but the bottom line is in
the middle of the night our time European markets went into a
tailspin," he said.
After a 195-point slide, the Dow Jones Industrial Average (DJI)
was lately off 151.13 points at 14,605.65, with B. of A. (BAC)
pacing the index's declines that had all but two of its 30
components in the red.
B. of A. shares slid 4.5% after the lender reported
first-quarter earnings below Wall Street's estimates as its
mortgage business weighed.
Caterpillar Inc. (CAT) was down 1.9% after Macquarie downgraded
the construction-equipment maker to neutral from outperform.
The S&P 500 index (SPX) shed 23.67 points to 1,550.90, with
the energy and technology sectors weighing most heavily.
The technology-heavy Nasdaq Composite (RIXF) declined 58.73
points to 3,205.77. Apple fell 4.3% and Cirrus Logic Inc. (CRUS)
plummeted 13% after the chip maker and Apple supplier offered weak
first-quarter revenue guidance.
Bank of New York Mellon Corp. (BK) declined 3.2% after reporting
a first-quarter loss and adjusted earnings that missed
estimates.
Fairway Group Holdings Corp. (FWM) rallied 28% in its market
debut, after the New York grocer's initial public offering
reportedly got off to a strong start late Tuesday. Shares of rival
Whole Foods Market Inc. (WFM) fell 1.9%.
Textron Inc. (TXT) lost almost 13% after the firm forecast a
drop in business-jet deliveries and reported a first-quarter profit
beneath estimates.
Yahoo Inc. (YHOO) edged lower after Bank of America Merrill
Lynch upgraded the Internet company to buy from neutral, a day
after Yahoo forecast second-quarter sales below expectations.
For every stock that rose, nearly five fell on the New York
Stock Exchange, where 264 million shares traded as of 11:30 a.m.
Eastern.
Composite volume exceeded 1.5 billion.
Oil prices (CLK3) fell to just above $87 a barrel and gold edged
up (GCM3) to $1,390.50 an ounce on the New York Mercantile
Exchange.
The dollar (DXY) gained against other currencies and Treasury
yields fell, with the benchmark 10-year note (10_YEAR) just below
1.7%.
At 2 p.m. Eastern, the Federal Reserve will release its Beige
Book, which offers an economic analysis of its 12 districts.
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