Apple's sales 'miss,' European worries hurt stocks

Updated: 6:50 p.m. ET

Stocks ended lower today, and it was a struggle from the open.

Europe was a problem after a measure of German business confidence tumbled today and disagreements on banking reform and the pace of new austerity measures in Greece and Spain grew. European stocks ended lower, and the U.S. dollar rose against the euro. Moreover, gold (-GC) and crude oil (-CL) moved lower.

Apple (AAPL) was a problem after reporting it sold some 5 million iPhones over the weekend. By most measures, it was a great weekend, but the sales were less than Wall Street had expected. And Facebook (FB) was sharply lower after a Barron's article over the weekend suggested the shares were worth maybe $15. But Google (GOOG) shares burst to a new intraday high of $750.04 before slipping back to $749.38, a new closing high.

After the close, construction equipment maker Caterpillar (CAT) cut its 2015 earnings forecast to $12 to $18 a share from earlier guidance of $15 to $20. The guidance assumed no worldwide recession and continued modest economic growth. Shares were down $2.12 to $88.75 after falling 85 cents to $90.87 in regular trading.

The Dow Jones Industrial Average ($INDU) closed down 21 points to 13,559, its first two-day loss since Aug. 27-28. The Standard & Poor's 500 Index ($INX) was off 3 points to 1,457, its first three-day loss since the end of July. The Nasdaq Composite Index ($COMPX) was off 19 points to 3,161. The Nasdaq-100 Index ($NDX) was off 18 points to 2,844.

Article continues below.Despite the market's struggles today, the major indexes remain poised to finish higher for the fourth straight month. The Dow has had just one down month over the past 12, something not seen since March 1958 through February 1959. And stocks look to finish with a solid, though not spectacular, third-quarter performance.

Futures trading suggests a flat open for stocks on Tuesday. The Standard & Poor's/Case-Shiller Index for July will be released before the open. Also due will be the Conference Board's report on consumer confidence for September and the Federal Housing Finance Agency's home-price index report for July.

Earnings are due from Jabil Circuit (JBL) and Vail Associates (MTN).

Commodities fall on European worries
Thanks to Europe, crude oil in New York settled down 96 cents to $91.93 a barrel, its lowest level since Aug. 3. Brent crude was down $1.64 to $109.78. It has been trading for several days at levels last seen in early August.

The national average price of gasoline was $3.808 a gallon, its lowest level since Aug. 29, according to AAA's Daily Fuel Gauge Report.

Gold, meanwhile, settled down $13.40 to $1,764.60 an ounce. It hit a near-term closing high of $1,772.70 on Sept. 14 as markets reacted to the Federal Reserve's decision to buy up to $40 billion a month in mortgage-backed securities in an open-ended bid to stimulate the economy.

The 10-year Treasury yield fell to 1.72% from Friday's 1.76%.

Energy prices -- New York close
			Mon.			Fri.			Month chg.			YTD chg.
Crude oil (-CL)			$91.93			$92.89			-4.71%			-6.98%
(per barrel)
Heating oil (-HO)			$3.0961			$3.1177			-2.64%			6.24%
(per gallon)
Natural gas (-NG)			$2.8370			$2.8850			1.36%			-5.09%
(per mil. BTU)
Unleaded gasoline (-RB)			$2.7877			$2.8195			-6.23%			4.90%
(per gallon)
Brent crude			$109.72			$111.42			-4.15%			2.26%
(per barrel)
Retail gasoline			$3.8080			$3.8140			-0.55%			16.24%
(per gallon; AAA)

Apple shares drop as iPhone sales come up short
Apple shares fell $9.30 to $690.79. The problem for investors: There was so much excitement over the iPhone 5 before its release that some analysts predicted sales of 8 million units or so. Didn't happen.

Apple said today the sales over the weekend were about 5 million, something it has never done before. Phones were sold out in many stores, and many customers had to content themselves with ordering the device. The question is whether Apple underestimated demand  or simply kept production at relatively low levels so that the perceived shortage would cause even more frenzy.

The question gets more complicated by reports of a riot involving some 2,000 workers at a Foxconn factory in northern China. The factory is believed to be one of the plants Foxconn uses to assemble iPhones. (Apple subcontracts all of its manufacturing.) It's not clear if the riot caused damage to the factory or if it will hurt iPhone production.

Apple was the biggest factor in the declines for the Nasdaq and Nasdaq-100.

Also lower were shares of companies that make components used in the iPhone. Cirrus Logic (CRUS) was off $1.78 to $40.18. Skyworks Solutions (SWKS) was off 77 cents to $24.03. Broadcom (BRCM) fell 60 cents to $35.64. Avago Technologies (AVGO) was off 91 cents to $34.60. Qualcomm (QCOM) dropped 60 cents to $63.67.

Google, meanwhile, benefited from its strong position in search and the success of mobile phones using its Android operating system.

Wall Street doesn't care about Lennar's earnings beat
Homebuilding shares were lower despite boffo earnings reported by Lennar (LEN).

Lennar said it earned $87.1 million, or 40 cents a share, in the fiscal third quarter, up from $20.7 million or 11 cents a year ago. Revenue was up 34.1% to $1.1 billion.

But the shares fell 55 cents to $36.96. They had dropped to as low as $36.04 in the midafternoon. Despite the fall, the shares are still up 88% this year.

Also falling: Ryland (RYL), down 68 cents to $32.14; D.R. Horton (DHI), down 33 cents to $22.04; MDC Holdings (MDC), off 21 cents to $39.94, PulteGroup (PHM), down 22 cents to $16.76, and KB Home (KBH), down 63 cents to $14.63.

Profit-taking seems to have kicked in. The homebuilding sector has been one of the best performers as evidence of a recovery in housing is starting to take hold. 

Facebook slides -- again

Facebook shares were down $2.07 to $20.79 today after a weekend article in Barron's said it is "still too pricey" despite a sharp decline since its initial public offering.

Though Facebook's stock has plunged since its May IPO, Andrew Bary at Barron's said the stock trades at "high multiples of both sales and earnings, even as uncertainty about the outlook for its business grows."

At issue is the shift of Facebook's massive user base to mobile devices, where Facebook is still figuring out how to make advertising work. Bary said success in the mobile space is "no sure thing" for the company.

European disagreements, worries hit markets
Europe's problems suddenly became noisy again.

German Chancellor Angela Merkel and French President Francois Hollande disagreed on a timetable for starting joint oversight of Europe’s banking sector.

Merkel rejected Hollande’s appeal to activate oversight of the banking union, "the earlier, the better." The deadlock over regulation may delay into next year a key building block in resolving the single currency’s debt crisis.

German business confidence unexpectedly fell for the fifth straight month in September to the lowest reading since February 2010. The Ifo Institute in Munich said its business climate index, based on a survey of 7,000 executives, dropped to 101.4 from 102.3 in August. Economists had predicted an increase to 102.5.

Germany's Xetra Dax Index ($DE:DAX) was down 38 points to 7,413. Despite the decline, the index is up 5.9% in September and 15.5% for the third quarter.

Short hits from the markets -- New York close
			Mon.			Fri.			Month chg.			YTD chg.
Treasury yields
13-week Treasury bill			0.1000%			0.100%			11.11%			900.00%
5-year Treasury note			0.659%			0.672%			10.57%			-20.60%
10-year Treasury note			1.718%			1.760%			9.99%			-8.18%
30-year Treasury bond			3.032%			3.032%			12.97%			4.95%
Currencies
U.S. Dollar Index			79.577			79.398			-2.02%			-1.17%
British pound			1.6202			1.6252			1.98%			4.28%
(in U.S. $)
U.S. $ in pounds			£0.617			£0.615			-1.94%			-4.10%
Euro in dollars			$1.29			$1.30			2.47%			-0.39%
(in U.S. $)
U.S. $ in euros			€ 0.775			€ 0.770			-2.41%			0.39%
U.S. $ in yen			78.00			78.13			-0.62%			1.17%
U.S. $ in Chinese			6.33			6.30			-0.46%			0.13%
yuan
Canada dollar			$1.020			$1.025			0.58%			3.99%
(in U.S. $)
U.S. dollar			$0.981			$0.976			-0.58%			-3.84%
(in Canadian $)
Commodities
Gold (-GC)			$1,764.60			$1,778.00			4.56%			12.62%
(per troy ounce)
Copper (-HG)			$3.732			$3.789			7.94%			8.60%
(per pound)
Silver (-SI)			$33.9840			$34.6380			8.08%			21.74%
(per troy ounce)
Wheat (-ZW)			$8.9200			$8.9725			0.28%			36.65%
(per bushel)
Corn (-ZC)			$7.4475			$7.483			-6.88%			15.20%
(per bushel)
Cotton			$0.7250			0.7325			-6.16%			-20.92%
(per pound)
Coffee			$1.7230			1.733			4.58%			-24.97%
(per pound)
Crude oil (-CL)			$91.93			$92.89			-4.71%			-6.98%
(per barrel)