US stocks slide on profit taking

U.S. stocks declined in the morning session on Tuesday as investors are looking for excuses to lock in gains after the Nasdaq Composite Index's three-session record run.

By midday, the Dow Jones Industrial Average dropped 205.64 points, or 1.14 percent, to 17,894.77. The S&P 500 dipped 8.74 points, or 0.41 percent, to 2,119.54. The Nasdaq lost 15.41 points, or 0.30 percent, to 5,203.45.

In the absence of major U.S. economic reports, Wall Street mainly focused on the second-quarter earnings season which gets into full swing with Apple scheduled for release after the closing bell.

Second-quarter earnings reports from big companies came in roughly negative on Tuesday, dampening market sentiment.

International Business Machines Corporation (IBM) shares slumped 5.53 percent around midday on Tuesday as its revenues missed market estimates.

IBM announced second-quarter 2015 diluted earnings from continuing operations of 3.58 U.S. dollars per share, down 15 percent year on year.

Shares of Verizon dipped 2.39 percent around midday after the company delivered quarterly earnings above estimates and revenues shy of forecast.

The biggest U.S. wireless service provider reported 1.04 dollars in EPS in second-quarter 2015, compared with 1.01 dollars per share in second-quarter 2014.

Apple was also in spotlight as the iPhone maker is expected to post its earnings report after Tuesday's closing bell. Analysts polled by Thomson Reuters expected that the company's earnings per share is seen increasing to 1.79 dollars from 1.28 dollars a year earlier.

U.S. stocks ended slightly higher on Monday, with the Nasdaq setting a closing record for the third straight session, as investors digested positive second-quarter earnings reports.