U.S. stock indexes are little changed Tuesday morning as weak auto sales drag down car makers even as other companies report strong earnings.
NEW YORK — U.S. stock indexes are little changed Tuesday morning as weak auto sales drag down car makers even as other companies report strong earnings. Industrial companies including engine maker Cummins and pump and valve maker Flowserve are rising after they posted their first-quarter results. Ford, General Motors and Fiat Chrysler are falling as it appears U.S. car sales are slowing down.
KEEPING SCORE: The Standard & Poor's 500 index remained at 2,387 as of 10:23 a.m. Eastern time. The Dow Jones industrial average added 14 points, or 0.1 percent, to 20,928. The Nasdaq composite lost 6 points, or 0.1 percent, to 6,086 after it set a record high Monday. The Russell 2000 index of small-company stocks sank 6 points, or 0.5 percent, to 1,400. That was a hint investors were concerned that weak auto sales are a warning sign about the U.S. economy. Those same worries hurt stocks a month ago.
STOP SIGNS: Big automakers said their U.S. sales fell last month, a strong signs that demand for cars, trucks and SUVs is starting to slow after seven straight years of growth. Ford's sales were down 7 percent in April as car sales plunged and GM's sales slid 6 percent as it sold fewer pickup trucks. Toyota posted a smaller decline. Vehicle sales have set records the last few years and experts expect that streak to end this year. While sales are still strong overall, analyst are worried car companies are relying too much on discounts and incentives to boost sales.
Ford lost 45 cents, or 3.9 percent, to $10.97 and GM gave up 94 cents, or 2.8 percent, to $33.26 while Fiat Chrysler skidded 60 cents, or 5.2 percent, to $10.82. Car suppliers and rental companies like AutoNation and BorgWarner slipped as well.
Some investors see car sales as an important indicator of how much consumers are willing to spend overall, and stocks struggled a month ago following a weak round of March auto sales reports.
EARNINGS POWER: Industrial companies made the biggest gains early on. Cummins reported a far bigger profit and better sales than analysts expected, and its stock climbed $8.65, or 5.7 percent, to $159.98. The company said demand from construction and mining sales grew compared to a year ago, but it said truck production in North America fell.
Flowserve, which makes pumps, valves, and other products for the oil and gas industries, beat expectation and said contract bookings improved. It added $2.09, or 4.2 percent, to $51.74. Meanwhile power management company Eaton said its sales grew for the first time in two years as hydraulics revenue jumped. The company raised its forecasts for the rest of the year and its stock gained 63 cents to $76.76.