CAT - U.S. Markets Slump During Busy Earnings Season

The S&P 500 fell to start August as investors navigated a flood of corporate earnings reports and assessed a fresh batch of economic data.

The Dow Jones Industrials reversed 17.88 points to pause for lunch Tuesday at 35,541.65

The S&P 500 Index slumped 15.26 points to 4,573.70.

The NASDAQ index shed 52.78 points to 14,291.

Pharmaceutical giant Merck reported a smaller-than-expected loss and revenue that exceeded expectations thanks to strong Keytruda sales. Merck shares rose 1.6%. Caterpillar also reported better-than-expected earnings and revenue, boosting shares 7%.

Pfizer added 1.7% even after posting mixed results due to plummeting COVID product sales, while Uber lost nearly 5% on mixed earnings.

This week marks the busiest stretch of second-quarter earnings with more than 160 S&P 500 constituents slated to report results. More than half of the companies in the broad market index have already reported, with 82% topping earnings expectations, according to FactSet.

This has fueled some hopes that the economy will be able to avoid a recession as inflation shows signs of cooling.

Despite the performance so far, analysts are bracing for a 7.1% earnings decline from a year

Prices for the 10-year Treasury tumbled, raising yields to 4.04% from Monday's 3.96%. Treasury prices and yields move in opposite directions.

Oil prices sank 56 cents to $81.02 U.S. a barrel.

Gold prices darkened $24.80 to $1,984.40 U.S. an ounce.