(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window.)
* Xilinx jumps on $35 bln buyout deal from AMD
* Merck (NS: PROR ) up after raising profit forecast
* Indexes: Dow down 0.28%, S&P down 0.03%, Nasdaq up 0.56% (Adds comment, details; updates prices)
By Medha Singh and Shivani Kumaresan
Oct 27 (Reuters) - The S&P 500 and Dow fell on Tuesday, dragged down by a string of earnings disappointments and doubts about a coronavirus stimulus package before Election Day, although Nasdaq rose ahead of results from mega-cap technology companies.
Caterpillar Inc (NYSE: CAT ) CAT.N fell 2.2% and 3M (NYSE: MMM ) Co MMM.N slipped 1% after both the industrial companies reported lower quarterly earnings. sentiment sagged after the White House said a potential deal on COVID-19 relief could come in "weeks," casting doubt on whether an accord could be struck with Congress before the Nov. 3 election. is now pushed back to after the election and the market is digesting that today," said Thomas Hayes, managing member at Great Hill Capital LLC in New York.
Sectors sensitive to economic growth took a hit. The S&P 500 banks index .SPXBK and the S&P energy sector .SPNY shed about 1% each.
The three major U.S. stock indexes fell to near four-week lows on Monday as investors fretted about record number of new coronavirus infections in the United States and some European countries and an elusive fiscal stimulus.
Meanwhile, Wall Street's fear gauge .VIX hovered at its highest level in nearly two months on jitters over the outcome of the election. challenger Joe Biden leads President Donald Trump in national polls but the race is much tighter in battleground states which determine the election outcome.
At 10:53 a.m. ET, the Dow Jones Industrial Average .DJI fell 78.40 points, or 0.28% to 27,606.98, the S&P 500 .SPX lost 1.09 points, or 0.03% to 3,399.88 and the Nasdaq Composite .IXIC gained 63.73 points, or 0.56% to 11,422.67.
The tech-heavy Nasdaq rose as Microsoft Corp MSFT.O firmed 1% in the run-up to its results after the closing bell. Apple Inc AAPL.O , Amazon.com AMZN.O , Google-parent Alphabet GOOGL.O and Facebook Inc FB.O , which together account for about a fifth of the S&P 500's total value, also report results this week. expect the tech sector to post a 0.3% fall in third-quarter earnings from a year earlier, while overall S&P 500 profit is forecast to fall 18.4%, according to Refinitiv data.
Concerns over a rise in U.S. coronavirus cases are weighing on the market although technology sector, in particular, seems to be the least exposed, said Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
"A focus on big technology companies may move this market to rally despite the problems the virus is creating."
Insurer American International Group Inc (NYSE: AIG ) AIG.N gained 2% after its board named Peter Zaffino as chief executive officer and approved a plan to separate the life and retirement business from the rest of the company. designer Advanced Micro Devices Inc AMD.O fell 3.4% as it agreed to buy Xilinx Inc XLNX.O in a $35 billion all-stock deal. Xilinx shares soared about 10%, while those of Intel (NASDAQ: INTC ) fell 3.4%. & Co Inc MRK.N gained 0.2% as it raised its full-year earnings forecast. Drugmaker Eli Lilly and Co LLY.N fell about 5% after its quarterly profit took a hit from increased costs to develop a COVID-19 treatment. issues outnumbered advancers for a 1.4-to-1 ratio on the NYSE and nearly matched them on the Nasdaq.
The S&P index recorded 11 new 52-week highs and one new lows, while the Nasdaq recorded 18 new highs and 35 new lows.
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