Companies ranging from pancake house chain IHOP to high-priced handbag seller Coach reported signs of the continuing U.S. consumer pullback, sending retail and some restaurant stocks lower.
Adding to the pressure, discounter Wal-Mart Stores cut its capital spending plan for the current fiscal year, dragging down U.S. stock indexes and boosting bonds.
Meanwhile, Target on Monday lowered its September sales expectations.
"It certainly is a fairly pervasive number of companies reporting sales distress and it certainly covers a broad segment of the marketplace," said Carl Steidtmann, chief economist at consulting firm Deloitte.
U.S. consumers, who continued spending after the Sept. 11, 2001 attacks on the United States, a recession and the war in Iraq have been under pressure in recent months by falling housing prices and rising costs for food and energy.
Steidtmann said the factors causing consumers to pull back are likely to continue.
"We're in for an extended period of what will be relatively modest growth in terms of consumer spending," he said.
Et Tu, Coach?
The latest bad news about the consumer comes even from the luxury sector, which has typically held strong during periods of economic weakness.
Coach forecast earnings Tuesday in the current quarter at 68 cents a share, below the average analyst estimate of 70 cents posted by Reuters Estimates.
The retailer, known for its leather handbags, has seen weak traffic in its U.S. stores, particularly in the past several weeks, said Chief Executive Lew Frankfort.
On the other end of the spending spectrum, Wal-Mart said it now plans only $14.7 billion to $15.4 billion in capital expenditures this fiscal year. That is down from an original forecast of $17 billion and even below the $15.5 billion ceiling the retailer set in June.
Analysts and investors have pushed Wal-Mart to rein in U.S. expansion plans as sales at existing stores have slowed and it saturated many markets.
Wal-Mart's news briefly pulled the Dow Jones industrial average lower, offsetting optimism about U.S. earnings reports. The Blue Chip index was up 0.2 percent in early afternoon trading Tuesday.
Wal-Mart shares were fell below the 0.8 percent decline in the Standard & Poor's retailing index.
On the restaurant side, IHOP posted an $11.6 million quarterly loss due to an interest-rate hedge it put in place related to its planned acquisition of Applebee's International.
But earnings from operations also came in below analysts' estimates and the company said fewer customers came into its restaurants.
Falling traffic was also an issue at Brinker International , which posted a 21 percent drop in quarterly profit.
Rising labor costs also hurt its earnings, the company said.