NEW YORK (AP) — Stock indexes finished about where they started Tuesday after a round of disappointing corporate earnings and another drop in home prices. Trading was muted ahead of President Obama’s State of the Union speech, in which he was expected to outline a plan to reduce the deficit.
Four of the 30 companies in the Dow Jones industrial average reported results before the market opened: DuPont, 3M Co., Verizon Communications Inc. and Johnson & Johnson.
3M lost two percent after the manufacturing company’s income fell because of higher costs. Johnson & Johnson lost 1.8 percent after reporting a 12-percent drop in income. The maker of Tylenol and other drugs was hammered by costly recalls of its products.
DuPont’s income fell but still beat expectations. Its stock rose 0.3 percent. Verizon’s stock gained 1.6 percent after the phone company’s profits surged.
Another Dow member, American Express Co., fell 2.2 percent after reporting earnings late Monday that came in below analysts’ expectations.
The Dow lost 3.33 points, or less than 0.1 percent, to 11,977.19. It had been down as many as 82 points earlier.
The Standard & Poor’s 500 index inched up 0.34, or less than 0.1 percent, to 1,291.18.
The Nasdaq composite index gained 1.7 points, or 0.1 percent, to 2,719.25.
Doug Roberts, chief investment strategist for Channel Capital Research.com, said investors were looking ahead to President Barack Obama’s State of the Union speech Tuesday night and a Federal Reserve meeting that concludes Wednesday. The Fed’s $600-billion bond-buying plan, launched in November, was partially aimed at boosting stock prices. The S&P 500 has gained 8.9 percent in the last three months.
“As long as the Fed keeps pumping money into the economy,” Roberts said, “stocks will probably keep going up.”
Prices fell in 19 out of the 20 cities tracked by the Standard and Poor’s / Case-Shiller home price index in November.
Treasury prices rose ahead of the President’s State of the Union speech as traders hoped for news on spending curbs. That would ease worries in the bond market that the U.S. might soon run up against its borrowing limit.
The yield on the 10-year Treasury note fell to 3.34 percent from 3.39 percent late Monday. Bond yields move in the opposite direction of their prices.
Three stocks rose for every two that fell on the New York Stock Exchange. Consolidated volume came to 4.6 billion shares.