NEW YORK (AP) — A gloomy outlook from Caterpillar, the world's largest construction equipment company, tugged the stock market lower in afternoon trading Wednesday.

Caterpillar said its earnings fell 43 percent in the second quarter as China's economy slowed and commodity prices sank. The company also warned of slowing revenue and profit, and its stock dropped $2.22, or 3 percent, to $83.30.

Apple set off a rise in technology stocks after its drop in quarterly earnings still managed to beat analysts' estimates. Late Tuesday, the company reported that it shipped more iPhones in the latest quarter and announced plans to introduce new products in the fall. Apple jumped $24.43, or 6 percent, to $443.35

Outside of technology stocks, the broader market drifted lower. Nine of the 10 industry groups in the S&P 500 fell, led by utilities.

As of 2:30 p.m., the Dow Jones industrial average was down 43 points, or 0.3 percent, at 15,525.

The Standard & Poor's 500 index fell six points, or 0.4 percent, to 1,686. The technology-heavy Nasdaq composite index climbed three points, or less than 0.1 percent, to 3,582.

Despite some high-profile misses this earnings season, the larger trend for corporate profits looks good. Analysts forecast that second-quarter earnings for companies in the S&P 500 increased 4.2 percent over the same period last year, according to S&P Capital IQ. More than six out of every 10 companies have hurdled Wall Street's earnings targets.

"Yes, they're beating expectations, but expectations are so low," said Brad McMillan, chief investment officer at Commonwealth Financial. The overall number masks some worrisome trends, he said.

Financial firms such as Goldman Sachs and Capital One, have posted the highest rate of earnings growth of any industry. Pull their results out of the total, however, and earnings are on track to slump 3.5 percent, according to FactSet.

"You can't call this a blowout quarter so far," McMillan said.

Among other stocks making big moves, AT&T dropped 82 cents, or 2 percent, to $34.98. Higher costs hit AT&T's profits in the latest quarter. The company's coffers were drained by smartphone sales, which it subsidizes in the hope of making money back over the life of two-year contracts.

Surging demand for pickup trucks in the U.S. helped Ford Motor post higher quarterly profits. Sales in China also jumped 47 percent in the first six months of the year. The second-largest car company in the U.S. raised its profit forecast and its stock climbed 43 cents, or 2.5 percent, to $17.37.

Another 25 big companies, including Visa and Qualcomm, are set to release reports after the closing bell.

In Europe, a broad gauge of economic activity reached the highest level since January 2012, sending stock markets in Germany and France higher. Financial information company Markit said Wednesday that its monthly purchasing managers' index for the countries that use the euro currency increased for the fourth month running.

France's CAC 40 rose 1 percent and Germany's DAX 0.8 percent.

The report out of Europe pushed prices for U.S. government bonds down and their yields up. The yield on the 10-year Treasury note rose to 2.59 percent from 2.51 percent late Tuesday.

Signs of economic strength usually lead traders to sell Treasurys, considered one of the safest places in the world to park cash.