US stocks decline after reaching record levels amid disappointing corporate earnings

U.S. stocks retreated, snapping the Standard & Poor’s 500 Index five-day rally, as forecasts at companies from Caterpillar Inc. to Broadcom Corp. disappointed investors.

The S&P 500 fell 0.5% to 1,746.38 at 4 p.m. in New York. The Dow Jones Industrial Average lost 54.33 points, or 0.4% to 15,413.33. About 6.6 billion shares changed hands on U.S. exchanges, 12% higher than the three-month average. Nasdaq declined 0.6% to 3,907.07.

“The market has run quite a bit,” Edward Painvin, chief investment officer of Chase Investment Counsel Corp., said by phone to Bloomberg from Charlottesville, Virginia. His firm oversees $500 million. “Every time you have that kind of move going into earnings season, expectations are high. The market is going to be placing an increasing amount of emphasis on companies delivering expectations and providing some clarity for 2014.”

A disappointing report on September employment pushed Tuesdays rise, as it backed up investor views that the Federal Reserve would maintain its bond-buying efforts into next year.

“A weak payroll report is good for Fed policy, but that still leaves us with a weak report,” said Russ Koesterich, global chief investment strategist with BlackRock. “With a number of economic numbers looking a bit lackluster over the past few weeks, that calls into question fourth-quarter earnings.”

In corporate world, Broadcom lost 2.9% to $26.36 after it forecast fourth-quarter revenue of about $1.92 billion to $2.03 billion. Analysts on average had predicted $2.13 billion. The company said it’s cutting as many as 1,150 jobs as demand slows for chips that connect mobile phones to the Internet.

Boeing, the world’s largest plane maker, added 5.3% to $129.02, an all-time high. Revenue and free cash flow are surging as Boeing speeds the production tempo for single-aisle 737s, wide-body 777s and 787 Dreamliners to take advantage of airlines’ demand for more fuel-efficient jets. Boeing raised the 787’s planned output rate to 12 a month in 2016, up from a goal of 10 by the end of 2013.

Corning, the maker of glass for televisions and mobile devices, surged 14% to $17.52 for the biggest increase in the S&P 500 after the company said it will buy Samsung’s 43% stake in Samsung Corning Precision Materials Co., which makes glass for liquid crystal displays in South Korea.