Weak earnings drag US stocks lower in early trade

KEN SWEET
FILE - In this Tuesday, Jan. 14, 2014 file photo, traders gather at a post on the floor of the New York Stock Exchange. World stock markets struggled on Thursday Jan. 16, 2014 as they fought to scrape out more gains a day after a key U.S. benchmark climbed to a new high on strong earnings and economic data. (AP Photo/Richard Drew)

NEW YORK (AP) — After hitting a record high the day before, the stock market moved lower in early trading Thursday as investors reacted to disappointing results from Best Buy, Citigroup and the railroad operator CSX.

KEEPING SCORE: The Standard & Poor's 500 index was down three points, or 0.2 percent, at 1,845 in the first half-hour of trading. The Dow Jones industrial average lost 38 points, or 0.2 percent, to 16,446. The Nasdaq composite edged down a point to 4,212.

BEST BUY: The electronics store chain plunged $11, or 30 percent, to $26.52, by far the biggest drop in the S&P 500 index. Best Buy said its sales fell 0.8 percent for the nine weeks ended Jan. 4, while analysts had expected growth. The holiday shopping period is the most important time of the year for retailers, where chains like Best Buy can make up to 40 percent of their annual sales.

BANKS: Goldman Sachs and Citigroup reported earnings before the opening bell. Citigroup's results fell short of analysts' expectations due to weakness in its bond and mortgage businesses, sending its stock down $1.76, or 3 percent, to $53.23. Goldman Sachs also reported a drop in fourth-quarter profit to due problems in its mortgages and bond trading division. However, Goldman's earnings beat analysts' expectations. Goldman lost $1.38, or 1 percent, to $177.20.

TRANSPORTATION: The Dow Jones Transportation Average, also known as the Dow Transports, was down nearly 1 percent in early trading. The railroad company CSX warned investors Thursday that it might be difficult to reach its own profit targets over the next two years because of ongoing weak demand for coal. The news pushed CSX down $2.21, or 8 percent, to $27. Other railroad stocks including Union Pacific and Norfolk Southern fell 2 percent or more.

JOBS: The number of Americans seeking unemployment benefits fell 2,000 last week to a seasonally adjusted 326,000, a sign that layoffs are weighing less on the job market and economic growth. The less volatile four-week average dropped 13,500 to 335,000.

BONDS: Prices on U.S. government bonds rose slightly. The yield on the 10-year Treasury note, a benchmark for many kinds of loans including home mortgages, fell to 2.85 percent from 2.89 percent the day before.