(USA TODAY) -- U.S. stocks closed sharply lower Tuesday as investors hoping for signs of a rebound in corporate profitability were greeted with downbeat news instead, as a quarterly earnings miss from a large aluminum company and profit downgrade from a gene-sequencing firm dimmed the outlook for earnings.

The Dow Jones industrial average closed down 200 points, or 1.1%, to 18,128.66, as aluminum maker Alcoa kicked off the unofficial start to the third-quarter earnings seson by reporting sales and earnings that fell short of targets. Adding to the angst was biotech play Illumina, which downgraded its revenue forecast for both the quarter-ended in September and the final quarter of 2016.

The broad Standard & Poor's 500 stock index was 1.2% lower and the Nasdaq composite, which started Tuesday's session within 0.2% of its record high, was down 1.5%.

Shares of Alcoa (AA) fell more than 11% to $27.92 after it posted disappointing earnings results. Illumina's stock fell nearly 25% to $138.99.

The woes of Alcoa and Illumina hurt market sentiment, as investors are hopeful that third-quarter profit growth for the S&P 500 can finish positive, and end a dismal streak of contracting earnings growth at four quarters, according to Thomson Reuters data. Currently, analysts forecast earnings to contract a little less than 1% in the July thru September quarter.

"I think there are some concerns over third-quarter earnings," says Bill Hornbarger, chief investment strategist at Moneta Group.

The good news is the earnings season is just underway and the storyline could turn more positive as more companies report, says Doug Cote, chief market strategist at Voya Investment Management.

"The market will be wobbly until we really get to the crux of the reporting period," says Cote.

U.S. long-term bond yields continued to rise amid fears the Federal Reserve will raise short-term rates later this year. The yield on the 10-year Treasury note was slightly higher at 1.76%. Earlier Tuesday it hit 1.8% for the first time since early June, marking a four-month high.

Futures markets are now pricing in roughly 70% odds of a rate hike at the Fed's December meeting, according to CME Group. Low rates have been a key driver of stock prices in the bull market, and more recently fears of rate hike have dragged down once-hot stocks that pay out plump dividends, or income, and are less appealing in an environment of rising rates.

Hornbarger says many of those stocks were under pressure again Tuesday. For example, the Utilities Select Sector SPDR ETF fell 1.1%, posting its eleventh down day out of the past 12 sessions.

Also hurting the broader market was a dip in the price of U.S.-produced crude, which fell 52 cents, or 1%, to $50.3 per barrel, putting the brakes on a big rally that has been fueled by hopes of an OPEC prodution cut, which gained more credence Monday when Russian president Vladimir Putin backed a cut.

Stocks were also being weighed down by a rise of about 0.7% in the value of the dollar vs. foreign currencies, which makes U.S. exporters less competitive. The British pound was again under pressure, as Britain officials weigh the financial impact of Brexit, now that the UK has set a timetable of early 2017 to start in motion Britain's exit from the single-market European Union.

The pound was down nearly 2% vs. the dollar, and still near at 31-year low vs. the greenback.

Overseas, Asian stocks closed mixed with Japan's Nikkei 225 rising 1% and Hong Kong's Hang Seng composite losing 1.3%.

In London, the FTSE 100 index, which is filled with exporters that benefit from a lower pound, rose to record-high territory in early trading before reversing course and closing down 0.4%. In Germany, the DAX index fell 0.4% and the CAC 40 in Paris finished 0.6% lower.