Investors finding little to look forward to

The stock market is forward-looking. That is a problem when there is not much to look forward to.

Stocks sank for the fourth straight day Tuesday, as investors looked past a series of outwardly positive earnings reports and fixated on threats to the nine-year bull market.

Foremost among them is the Federal Reserve. Super-low interest rates from the central bank have fueled much of the rally, pushing up the prices of stocks and bonds since the Great Recession.

Now the Fed is slowly withdrawing some of its support. It is shrinking its portfolio of government bonds and lifting interest rates. The new environment is evident in interest rates on government bonds, closely watched by many investors. The yield on the 10-year Treasury note touched 3 percent in trading Tuesday. That benchmark interest rate — which influences the price of borrowing for both consumer loans and corporate bonds — has not been that high since early 2014.

It is not just interest rates. The threat of a trade war, or even a real war, is unnerving investors. Oil prices have spiked because of tensions in the Middle East.

Those rising commodity prices represent something of a double worry for investors. For one thing, they feed into price inflation, making it even more likely the Fed will continue to raise interest rates. (One of the Fed’s main objectives is keeping prices stable.) At the same time, higher commodity prices eat into profit margins for companies.

Last year, investors might have shrugged off those concerns, preferring to focus on the prospect of a major cut in U.S. corporate tax rates. That tax cut came to fruition in December, and it supercharged corporate profits. But that was a one-time event.

Now other events are looming, and investors do not see much to be excited about. With congressional elections later this year, the prospects of pro-business legislation are dim.

In short, it is up to companies themselves to give investors reasons to believe their shares can keep climbing. Recent reports suggest that is becoming harder to do. Shares of Alphabet, the parent of Google, dropped sharply Tuesday despite the company reporting Monday that its quarterly profit rose 73 percent. Investors appeared concerned with a surge of spending at the company that hurt its profit margins.

Earnings reports also provoked a sell-off in the industrial giants 3M and Caterpillar. Investors were rattled by lower sales and profit forecasts and by sluggish demand for the products that 3M sells to auto body shops. Its shares sank 6.8 percent.

And investors, after initially applauding Caterpillar’s first-quarter results, were unnerved when an executive said the first quarter might be a “highwater mark” for the year. Shares fell 6.2 percent.