NEW YORK- A slew of US com­pa­nies an­nounced big prof­its yes­ter­day, but in­vestors spooked about the econ­o­my sold stocks any­way. In­vestors shift­ed be­tween buy­ing and sell­ing ear­ly, then stuck with sell­ing af­ter de­cid­ing that the strong earn­ings re­sults weren't enough to make up for weak re­ports on jobs, hous­ing and man­u­fac­tur­ing. The Dow Jones in­dus­tri­al av­er­age fell 68.65 points, or 0.5 per cent, to close at 12,964.10. The broad­er Stan­dard & Poor's 500 in­dex dropped 8.22 points, or 0.6 per cent, to 1,376.92. Mor­gan Stan­ley rose 2.3 per cent af­ter it beat Wall Street's earn­ings and rev­enue es­ti­mates. Unit­ed­Health Group Inc. rose 2.4 per cent af­ter re­port­ing high­er prof­its. eBay, South­west Air­lines and Bank of Amer­i­ca al­so beat fore­casts.

Stock in­dex­es fell af­ter two rel­a­tive­ly weak eco­nom­ic re­ports came out mid-morn­ing. An in­dex of re­gion­al man­u­fac­tur­ing com­piled by the Philadel­phia branch of the Fed­er­al Re­serve dropped sharply, and the Na­tion­al As­so­ci­a­tion of Re­al­tors said home sales fell 2.6 per cent last month. In oth­er trad­ing, the Nas­daq com­pos­ite fell 23.89 points, or 0.8 per cent, to 3,007.56. Tech stocks could be in for some gains Fri­day fol­low­ing a strong earn­ings re­port af­ter the clos­ing bell Thurs­day from Mi­crosoft. The soft­ware mak­er was up 2.8 per cent in post-mar­ket trad­ing af­ter re­port­ing a rise in sales of its Win­dows op­er­at­ing sys­tem. Thurs­day's slide be­gan from the start of trad­ing. In­vestors were on edge af­ter stocks fell a day ear­li­er on wor­ries that Spain could have trou­ble pay­ing down its gov­ern­ment debt. Adding to the jit­ters, the Bank of Spain had re­port­ed that bad loans at the coun­try's banks had hit an 18-year high.

Be­fore the open­ing bell Thurs­day, in­vestors were ner­vous­ly watch­ing a sale of new gov­ern­ment bonds from Spain. The auc­tion met with high de­mand, and more bonds were sold than ex­pect­ed, but yields rose any­way. The yield on Span­ish ten-year notes rose to 5.87 per cent, an in­crease of 0.06 per­cent­age point. Ger­many's DAX end­ed 0.9 per cent low­er at 6,671.22 while France's CAC-40 tum­bled 2.1 per cent to 3,174.02, hurt al­so by un­con­firmed ru­mours that the coun­try might see its cred­it rat­ing down­grad­ed. Britain's FTSE 100 was more re­silient, clos­ing flat at 5,744.55. All but three of the 30 stocks in the Dow fell.