US open: Equity markets edge lower amid deluge of corporate earnings

After around half an hour of trading, the Dow Jones Industrial Average was down 47 points to 17,183.40, while the S&P 500 and the Nasdaq were six and 18 points lower respectively.

The US reporting season has had a mixed start and with economic data mostly positive, there is little agreement among traders and strategists about whether the Federal Reserve will hike rates this year.

Mixed earnings on Wall Street

Among the companies that reported before the opening bell, Verizon rose 0.60% after it posted third quarter earnings that beat expectations, while insurer Travelers Cos climbed 2.30% after its third quarter profit and revenue topped Wall Street’s forecast.

Harley Davidson slumped 9.46% after its quarterly profit fell short of expectations, while defence group Lockheed Martin shed 1.63% after saying its third quarter profit declined on the back of lower demand and military force reductions.

After the market closes, Yahoo!, Discover Financial Services and Chipotle Mexican Grill are all scheduled to release quarterly earnings.

Meanwhile, IBM shed 4.96% after the technology giant posted a drop in third quarter revenue late on Monday.

Flash memory manufacturer SanDisk surged 6.34% after Bloomberg reported the company was in advanced negotiations with Western Digital over a takeover offer it received.

Honeywell International gained 0.09% and could be in focus after revealing it had reached an agreement to sign German-based laboratory research business Seelze from Sigma-Aldrich for $119.4m.

Yum Brands jumped 4.55% after the owner Pizza Hut, Taco Bell and KFC revealed plans to spin off its business in China.

On the economic data front, construction on new US homes snapped a two-month decline and rose in September, figures released on Tuesday showed.

According to the Commerce Department, housing starts climbed 6.5% last month to 1.21m compared with an upwardly revised reading of 1.1m last month, while analysts expected a largely unchanged reading.

"Stronger-than-expected housing starts suggest more residential investment," said analysts at Barclays.

"However, much of this activity is likely to show up in construction spending in the fourth quarter.

"Our third quarter GDP tracking estimate remains unchanged after rounding at 1.2%.

Elsewhere, Asian equity markets struggled for direction, as lower oil prices offset a rally in Chinese stocks, while European stocks reversed earlier gains to edge lower.

The dollar was broadly stable against the pound but declined 0.31% against the euro and gained 0.21% against the yen, while gold futures climbed 0.25% to $1,173.70.

Oil prices were mixed, with West Texas Intermediate gaining 0.22% to $46.38 a barrel, while Brent shed 0.33% to $48.45 a barrel.