Tuesday's unofficial close: US stocks fall from highs; earnings don not excite

US blue chip stocks fell in heavy trade on Tuesday from multiyear highs set on Friday as investors with hard-to-beat expectations waved off strong profits from Citigroup Inc and 3M Co.
Technology stocks held close to unchanged, buoyed by fibre-optic components maker JDS Uniphase Corp and online stock trading firm Ameritrade Holding Corp.
"We have come a long way," said Brian Pears, head of equity trading at Victory Capital Management. "I wonder how much more of an effect good news can have at this point."
Stocks have soared since last March, with the Nasdaq Composite Index notching a new 2 1/2-year high on Friday, as investors anticipate strong earnings.
Investors are now looking for confident profit forecasts before sending stocks higher.
The Dow Jones industrial average was down 53 points, or 0.50 percent, at 10,548. The broader Standard & Poor's 500 Index was down 0.89 of a point, or 0.08 percent, at 1,139. The technology-focused Nasdaq Composite Index was up 3 points, or 0.15 percent, at 2,144.
Massachusetts Senator John Kerry's surprise win over former Vermont Gov. Howard Dean in Iowa's caucus also dragged on the market, analysts said, as investors worried about uncertainty caused by a close-fought presidential election.
"Kerry is thought to have a better chance of beating Bush, not just by Democrats," said John Davidson, president of Partner Re Asset Management Corp "It increases the likelihood that there will be a serious challenge."
Honeywell International Inc led the Dow lower after the company said on Monday it ended talks with bankrupt auto-parts maker Federal-Mogul Corp on the possible sale of Honeywell's automotive Bendix friction materials business, a setback for Honeywell in settling some asbestos claims against the company. Its shares fell $1.91, or 5 percent, to $35.52.
Dow components Citigroup, 3M Co and United Technologies Corp all fell despite posting higher quarterly profits.
Citigroup shares were down 16 cents, or 0.3 percent, at $49.34. 3M shares fell $3.73, or 4.4 percent, to $81.75. United Technologies shares fell $2.36, or 2.4 percent, to $95.14.
Johnson & Johnson rose $1.16, or 2.3 percent, to $51.60 after reporting higher fourth-quarter profit, helped by sales of prescription drugs and a new heart device.
JDS Uniphase shares jumped 43 cents, or 8.3 percent, to $5.60 on talk it might be the subject of a take-over offer from French communications equipment maker Alcatel. Alcatel declined comment on the matter. No one at JDS was immediately available for comment.
Shares of online brokerage Ameritrade Holding Corp rose $1.92, or 12.5 percent, to $17.29 after it reported that quarterly profit more than tripled.