US STOCKS-Markets fall on earnings caution, energy selloff

* Alcoa falls ahead of reporting results

* Energy stocks fall as crude lower

* Tenet Healthcare sues Community Health Systems

* Dow up 0.01 pct, S&P down 0.3 pct, Nasdaq down 0.3 pct

* For up-to-the-minute market news see [STXNEWS/US]
(Updates with Alcoa earnings in paragraph 4, volume in last
two paragraphs)

By Edward Krudy

NEW YORK, April 11 (Reuters) – Stocks mostly fell on Monday
as energy shares sold off on lower oil prices and the onset of
earnings season was clouded by concern company outlooks may
fall short of expectations.

Worries that increased raw material costs and the effects
from Japan’s earthquake may affect coming quarters will put
companies’ forward-looking statements under increased

“Companies are going to be trying to dampen expectations
for the second quarter,” said Subodh Kumar, chief investment
strategist at Subodh Kumar & Associates in Toronto. “The market
focus is more internal as to whether it’s gone up too fast.

After the bell, Alcoa Inc (AA.N: Quote, Profile, Research) reported a first-quarter
profit that beat estimates and said its outlook for the rest of
2011 and beyond remains positive. But revenue of the aluminum
maker, the first Dow component to report quarterly results,
missed forecasts and the stock fell 3.6 percent to $17.13 in
post-market trade.

Energy shares fell as U.S. crude futures slid on
profit-taking. Occidental Petroleum (OXY.N: Quote, Profile, Research) fell 3.2 percent to
$100.42 while the S&P energy index (.GSPE: Quote, Profile, Research) fell 1.9 percent.

Profits for S&P 500 companies are seen rising 11.4 percent
from a year ago, according to Thomson Reuters data, but much of
that may be priced into shares. The S&P 500 is up over 5
percent this year. For details, see [ID:nN07256466]

Optimism over earnings contributed to recent gains,
despite turmoil in oil-producing regions and the disasters in
Japan. Despite the S&P 500’s gains this year, light trading
volume has prompted questions about the strength of the rally.

The Dow Jones industrial average (.DJI: Quote, Profile, Research) rose 1.06 points,
or 0.01 percent, at 12,381.11. The Standard & Poor’s 500 Index
(.SPX: Quote, Profile, Research) fell 3.71 points, or 0.28 percent, at 1,324.46. The
Nasdaq Composite Index (.IXIC: Quote, Profile, Research) lost 8.91 points, or 0.32
percent, at 2,771.51.

U.S. crude oil futures ended 2.5 percent lower after a
recommendation from top brokerage Goldman Sachs to take profits
after the recent rally triggered a sell-off.

In corporate news, Tenet Healthcare Corp (THC.N: Quote, Profile, Research) said it
has sued its suitor, Community Health Systems Inc (CYH.N: Quote, Profile, Research),
claiming the rival hospital operator admitted patients for
unneeded stays to overbill insurers, including Medicare.

Shares of Tenet sank 14.7 percent to $6.44 while Community
slumped 36 percent to $25.89. [ID:nN11291765]

NYSE Euronext (NYX.N: Quote, Profile, Research) on Sunday rejected a joint buyout bid
from Nasdaq OMX Group (NDAQ.O: Quote, Profile, Research) and IntercontinentalExchange
(ICE.N: Quote, Profile, Research) and said it was sticking with an earlier bid from
Deutsche Boerse AG (DB1Gn.DE: Quote, Profile, Research). Nasdaq reaffirmed that its offer
was superior to Deutsche Boerse’s lower offer. [ID:nN10204369]

NYSE shares fell 2.9 percent to $37.59 while Nasdaq OMX
fell 1.5 percent to $28.03 and ICE was unchanged at $120.55.

Also in deal news, Endo Pharmaceuticals Holding Inc
(ENDP.O: Quote, Profile, Research) said it would buy American Medical Systems Holdings
Inc (AMMD.O: Quote, Profile, Research) for about $2.6 billion while Level 3
Communications Inc (LVLT.O: Quote, Profile, Research) agreed to buy Global Crossing Ltd
(GLBC.O: Quote, Profile, Research) for $1.9 billion in stock. [ID:nL3E7FB1PZ] and

Endo rose 0.5 percent to $41.06 while American Medical
jumped 32 percent to $29.50. Level 3 rose 18.1 percent to $1.70
and Global Crossing surged 69 percent to $24.97.

Biogen Idec Inc (BIIB.O: Quote, Profile, Research) rose 7.2 percent to $78.55 and was
the top percentage gainer on the Nasdaq 100 (.NDX: Quote, Profile, Research) after the
company’s experimental multiple sclerosis drug met the main
goal in the first of two important late-stage studies.

Composite volume was light on the NYSE, Amex and Nasdaq
with 6.73 billion shares changing hands compared to last year’s
daily average of 8.47 billion.

Declining stocks outnumbered advancing ones on the NYSE by
about 5 to 2, while on the Nasdaq about two shares fell for
every one that rose.
(Editing by Leslie Adler)

US STOCKS-Markets fall on earnings caution, energy selloff