New York News of a slowdown at Corning triggered selloff Tuesday on Wall Street as investors' hopes for a business turnaround in 2001 dissipated further. The Dow Jones industrials fell 123 points, their fifth triple-digit drop in a month.
Analysts said the market was waiting, so far in vain, for companies to say the outlook for future revenues and earnings was improving.
It was likely that Compaq Computer's late-day announcement that it would meet second-quarter estimates but slash another 4,000 jobs to stay profitable would intensify the market's queasiness.
"Underlying this all is a feeling that the malaise in earnings isn't over yet," said Charles Pradilla, chief investment strategist at SG Cowen Securities. "The market is saying ... that those who thought there was going to be a considerable rebound in the third or fourth quarter this year were wrong."
The Dow closed down 123.76 at 10,175.64, a 1.2 percent decline.
The Nasdaq composite index fell 3.2 percent Tuesday, dropping 63.92 to 1,962.79, its lowest close since April 17.
Corporate profitability remained the focus. Investors punished Corning after the tech company reduced its earnings forecast and said it would close three manufacturing plants, as well as cut another 1,000 jobs from its photonic technologies division, because of an abrupt slowdown. Corning fell 98 cents to $14.12.
IBM fell $2.35 to $102.37 on fears it would miss estimates for the second quarter.