U.S. stocks declined on Tuesday, pulling the Dow under 17,000, as the United States and European Union joined in expanding sanctions against Russia, highlighting a geopolitical crisis that overrode investor enthusiasm for earnings from corporations including Merck & Co.
"Investors are clearly hyper-sensitive right now to things happening in Europe and Russia, and whether it's worsening or not," said Dan Greenhaus, chief global strategist at BTIG.
In a statement televised live Tuesday afternoon, President Barack Obama said the United States was expanding on measures announced two weeks ago, targeting Russian energy, defense and financial sectors as Russia has continued to support separatists in the Ukraine, and was still building up forces on its own border with Ukraine.
Obama's statement followed European Union governments that announced sanctions earlier in the day to reduce Russia's ability to tap into bank financing and advanced technology.
The sanctions, the most expansive so far over Russia's support of rebels fighting in Eastern Ukraine, triggered what Greenhaus called a "knee-jerk" reaction to headlines related to the crisis in the Ukraine, with Wall Street erasing gains that came with another round of largely better-than-expected corporate results.
Merck gained after the drug manufacturer reported better-than-expected quarterly results, with Pfizer also rising after posting earnings that beat estimates.
United Parcel Service, however, disappointed with the shipper's quarterly profit more than halved.
Twitter jumped in after-hours trading as the social-media company easily beat earnings and revenue estimates.
"We're continuing to go up on the back of earnings; we had some good reports," said Jim Dunigan, managing executive, investments, at PNC Wealth Management, speaking before the latest round of sanctions targeting Russia were announced.
Windstream Holdings led a surge in phone shares on its plan to spin off some telecommunications network assets into a publicly-traded real estate investment trust; Frontier Communications and CenturyLink jumped; as did Dow components AT&T and Verizon Communications.