Wall Street falls on disappointing reports from Intel, others

By Tanya Agrawal

REUTERS - U.S. stocks dipped in early afternoon trading on Thursday, after staying flat for most of the morning, as disappointing earnings reports from Intel and others outweighed the handful of promising reports.

Intel shares were down 4.3 percent at $34.14 after it reported slowing revenue growth at its key data center business.

The stock was the biggest drag on the S&P and Nasdaq. It also pulled the S&P technology index 0.5 percent lower.

Fellow chipmaker Qualcomm was the biggest positive influence on the S&P and Nasdaq, rising 7.4 percent after its results and forecast topped estimates.

Biogen was up 6.9 percent at $280.42 after strong results. The stock led the health sector 0.35 percent higher, making it the only gainer among the 10 major S&P sectors.

Southwest Airlines fell 8.7 percent and weighed on other airline stocks after it forecast a drop in a key profitability metric for the third quarter.

At 12:43 p.m. ET (1643 GMT) the Dow Jones Industrial Average was down 80.61 points, or 0.43 percent, at 18,514.42.

The S&P 500 was down 6.44 points, or 0.3 percent, at 2,166.58. The index had earlier come within a point of its previous record.

The Nasdaq Composite was down 10.24 points, or 0.2 percent, at 5,079.70.

"The recent rally has been more shallow and has been confined to a few sectors," said Art Hogan, chief market strategist at Wunderlich Securities in New York.

"Any pullback was to be expected given that the Dow rallied for nine straight days and you have to see today's action in that context. The broader macro context hasn't changed."

The S&P is up more than 6 percent for the year, while the Dow's nine-day winning streak is its best run since March 2013.

But the rally has been driven by defensive sectors such as telecoms and utilities amid concerns about global instability including Britain's recent vote to leave the European Union.

Even upbeat economic data did not influence the market. A report showed U.S. jobless claims unexpectedly fell to a three-month low last week, while home resales unexpectedly rose in June to their fastest pace in more than nine years.

Declining issues outnumbered advancing ones on the NYSE by 1,604 to 1,295. On the Nasdaq, 1,559 issues fell and 1,155 advanced.

The S&P 500 index showed 23 new 52-week highs and no new lows, while the Nasdaq recorded 70 new highs and 14 new lows.

(Reporting by Tanya Agrawal; Editing by Savio D'Souza)