Wall Street drifts lower as a 4-day rally loses momentum

NEW YORK (AP) — Stocks are drifting lower on Wall Street Tuesday as earnings reporting season gets underway for big companies.

The S&P 500 was down 0.3% in morning trading, taking a pause after a leap for Big Tech stocks capped a four-day winning streak on Monday. The Dow Jones Industrial Average was down 94 points, or 0.3%, at 28,743, as of 10:30 a.m. Eastern time, and the Nasdaq composite was close to flat.

The muted trading comes as many forces are pushing and pulling on markets simultaneously. Coronavirus counts are rising at a worrying degree in many countries around the world, and Johnson & Johnson said late Monday it had to temporarily pause a late-stage study of a potential COVID-19 vaccine “due to an unexplained illness in a study participant.” Uncertainty about the prospects for more stimulus for the economy from Washington is also hanging over markets.

Some measure of clarity is arriving as CEOs line up to report how their companies fared during the summer. Wall Street is expecting another sharp drop in profits for the third quarter, nearly 21% for S&P 500 earnings per share from a year earlier. But if that proves correct, it would not be as bad as the nearly 32% plunge for the spring, according to FactSet.

Several companies kicked the season off on Tuesday with better-than-expected reports. JPMorgan Chase, Johnson & Johnson, Citigroup and BlackRock all reported stronger results for the summer than analysts had forecast.

Their stocks, though, were mixed following the releases. BlackRock rose 3.3%, while JPMorgan Chase and Citigroup gave up initial gains. Johnson & Johnson fell 1.8%.

Delta Air Lines reported a worse loss than Wall Street had forecast, as the pandemic keeps many fliers grounded, and its shares fell 1.3%.

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