U.S. Stocks Fall; Texas Instruments, Regional Banks Drop

By Elizabeth Stanton

Oct. 21 (Bloomberg) -- U.S. stocks slid the most in four days as technology companies and regional banks reported earnings that missed estimates and predicted the slowing economy will keep damping profits.

Texas Instruments Inc., the second-largest U.S. semiconductor maker, declined 9 percent after forecasting a drop in sales, while Sun Microsystems Inc., the fourth-biggest maker of server computers, retreated 15 percent on revenue that fell short of analyst projections last quarter. Ohio lenders National City Corp. and Fifth Third Bancorp declined after reporting losses from bad loans.

``T.I.'s results confirm a global slowdown, which seems to have a proportionately larger effect on technology companies,'' said Steven Neimeth, manager of the $600 million SunAmerica Value Fund in Jersey City, New Jersey. ``It will likely result in U.S. equity managers focusing on U.S.-based companies, which may have limited downside vs. more global companies.''

The Standard & Poor's 500 Index lost 12.54, or 1.3 percent, to 972.86 at 9:35 a.m. in New York. The Dow Jones Industrial Average slipped 79.49, or 0.9 percent, to 9,185.94. The Nasdaq Composite Index fell 32.95, or 1.9 percent, to 1,737.08. About eight stocks dropped for each that rose on the New York Stock Exchange.

The decline stalled a rebound in the S&P 500 from an almost 5 1/2 year low on Oct. 10. The benchmark index for U.S. equities climbed 9.6 percent from then through yesterday as money-market interest rates declined and Federal Reserve Chairman Ben S. Bernanke endorsed another economic-stimulus package. At least 139 S&P 500 companies report third-quarter results this week, including Apple Inc. after the market closes today and McDonald's Corp. tomorrow.

Interest Rates

Today's earnings reports overshadowed another retreat in money market rates. The London interbank offered rate, or Libor, that banks charge each other for three-month loans in dollars dropped 23 basis points to 4.06 percent, the British Bankers' Association said. The overnight dollar rate slid 23 basis points to 1.28 percent, below the Federal Reserve's target for the first time since Oct. 3.

Texas Instruments lost $1.62 to $16.36. Fourth-quarter sales will be $2.83 billion to $3.07 billion and profit will be 30 cents to 36 cents a share, the company said. Analysts in a Bloomberg survey predicted profit of 44 cents a share on sales of $3.36 billion.

Sun fell 87 cents to $4.91. The company said fiscal first- quarter sales probably amounted to $2.95 billion to $3.05 billion. That missed the average of $3.15 billion expected by analysts surveyed by Bloomberg.

To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net