(For a live blog on the U.S. stock market, click LIVE/ or
type LIVE/ in a news window.)
* Apple drops after sales warning
* Walmart forecasts downbeat online sales growth
* Kroger jumps as Berkshire Hathaway reveals $549 mln stake
* Indexes down: Dow 0.75%, S&P 0.48%, Nasdaq 0.31%
(Updates to early afternoon)
By Medha Singh
Feb 18 (Reuters) - U.S. stocks dropped on Tuesday after a
surprise sales warning from tech bellwether Apple highlighted
the impact of the coronavirus outbreak on global supply chains.
The world's most valuable technology firm AAPL.O said it
would fall short of its recently announced quarterly sales
target because of slower iPhone production and weaker demand in
China, sending its shares down 2.6%. The news also sent Apple suppliers, including Qualcomm Inc
QCOM.O , Broadcom Inc AVGO.O , Qorvo Inc QRVO.O and Skyworks
Solutions Inc SWKS.O , lower by 1.8% to 2.3%.
China-exposed chipmakers slipped, with the Philadelphia SE
Semiconductor index .SOX shedding 1.6%, while the broader S&P
technology sector .SPLRCT lost 0.6%.
"The market is taking it in (its) stride, meaning that they
know that this virus is going to have an impact on the supply
chain but the severity of the impact is still unclear," said
Jeff Kravetz, regional investment strategist at U.S. Bank Wealth
Management.
"But investors are not overly concerned and we're higher
this year just because we've got an accommodative Fed, higher
earnings and - when you exclude the impact of the virus- an
incredibly resilient consumer."
While the exact hit to economic growth from the epidemic in
China - the global manufacturing hub - still remains to be seen,
hopes that the damage would only be temporary have helped Wall
Street's main indexes clinch record highs as early as last week.
At 12:35 p.m. ET, the Dow Jones Industrial Average .DJI
was down 221.13 points, or 0.75%, at 29,176.95 and the S&P 500
.SPX was 16.39 points, or 0.48%, lower at 3,363.77.
The Nasdaq Composite .IXIC was down 30.03 points, or
0.31%, at 9,701.14.
Energy stocks .SPNY fell 1.2%, while the interest-rate
sensitive banks sub-sector .SPXBK lost 1.8% as higher demand
for safer assets pressured U.S. Treasury yields. US/
Of the nearly 400 companies in the S&P 500 which have
reported fourth-quarter earnings, 70.8% have beat analysts'
profit estimates, according to IBES data from Refinitiv.
Walmart Inc WMT.N shares rose 0.9% even after the world's
biggest retailer forecast slowing online growth for the year and
reported weak results for the holiday quarter. Conagra Brands Inc CAG.N shed nearly 5.4% after the
packaged food company lowered its full-year profit and sales
outlook.
Among gainers, Kroger Co KR.N climbed 4.7% after Warren
Buffett's Berkshire Hathaway Inc BRKa.N unveiled a $549.1
million stake in the supermarket chain. Tesla Inc TSLA.O jumped 5.7% as Bernstein and Morgan
Stanley raised their prices targets for the electric carmaker's
shares.
Declining issues outnumbered advancers for a 1.68-to-1 ratio
on the NYSE and for a 1.54-to-1 ratio on the Nasdaq.
The S&P index recorded 65 new 52-week highs and five new
lows, while the Nasdaq recorded 108 new highs and 54 new lows.