NEW YORK ? U.S. stock indexes were slightly lower in midday trading as worries about a recession in Europe outweighed hopes that the U.S. economic recovery will gather steam.
The first week of the quarterly earnings season did little to help the market. Grocery store operator Supervalu plunged after reporting a wider loss Wednesday morning. The Dow Jones industrial average fell 38 points, or 0.3 percent, to 12,423 shortly after noon.
Germany reported that its economy contracted slightly at the end of 2011. The European Commission also said Hungary has taken "no effective action" to contain its deficit. Stock markets in Germany and France fell slightly and the euro dropped half a percent against the dollar.
"Europe is still the main risk," said Jeffrey Kleintop, chief market strategist at LPL Financial. "Yes, they've been making progress on their budgets but they clearly have growth problems."
Worries about Europe have weighed on stock prices and helped drive analysts' earnings estimates lower. S&P Capital IQ says analysts now expect that year-over-year growth in earnings at S&P 500 companies will "slow dramatically" to 7.2 percent in the fourth quarter from 17.6 percent in the third quarter.
The Standard & Poor's 500 index fell 2 points, or 0.2 percent, to 1,289 in midday trading Wednesday. The Nasdaq composite edged up 2 points to 2,703.
The recent jump in orange juice futures hit Coca-Cola, owner of Minute Maid, and PepsiCo, which has Tropicana. Coca-Cola Co. sank 2 percent, the most in the Dow. PepsiCo. Inc. fell 1 percent.
Orange juice futures have been rising sharply in volatile trading since late December, largely over concerns that cold weather in Florida could damage the crop there. They spiked 11 percent to $2.08 a pound Tuesday on news that the government would increase testing for a fungicide that was found in low levels in juice.
The contract fell back 8 percent to $1.90 Wednesday; analysts said the jump Tuesday may have been an overreaction and the market is waiting to see whether the Food and Drug Administration's tests turn up more problems. OJ is still up 15 percent from its recent low of $1.65 on Dec. 21.
Among companies making large moves:
? Urban Outfitters Inc. dropped 17 percent, the steepest fall of any stock in the S&P 500, following the abrupt resignation of its CEO, Glen Senk. The company, which also runs the Anthropologie and Free People stores, said last week that tough competition and a drive to reduce inventory led to more markdowns than expected during the holiday shopping season.
? Supervalu Inc. plunged 10 percent. The grocery store operator, which owns the Albertsons and Jewel-Osco chains, reported a wider loss because of high food prices and costs related to a turnaround plan. The company cut its forecast for full-year sales for the second quarter in a row.
? Commercial Metals Co. fell 6 percent to $13.89 after the investor Carl Icahn said he would end his hostile takeover attempt of the company. Only 23 percent of Commercial Metals' shareholders supported Icahn's $15-per-share offer, far short of Icahn's goal of 40.1 percent.
? Lennar Corp. rose 7 percent. Sales rose as the builder delivered more houses. Lennar reported a drop in quarterly earnings but said the housing market is starting to stabilize with the help of lower home prices and low interest rates.
The Dow closed at its highest point since July 26 on Tuesday, following European markets higher after Fitch Ratings said that it would not downgrade France's credit rating this year. The average of 30 large company stocks is up 1.7 percent to start the year. The S&P 500 is up 2.5 percent.
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