By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- After a shaky start, the U.S. stock
market inched higher, led by gains in energy and materials sectors,
as investors digested a slew of earnings results.
Monday's positive movement in the Dow industrial comes even as
one of its major components, IBM, posted disappointing quarterly
results, pushing shares of the tech giant lower and dragging down
the index.
The Dow Jones Industrial Average (DJI) was down about 70 points,
or 0.4%, lower at 16,306.00.
The S&P 500 (SPX) was about 4 points, or 0.2%, higher at
1,891.8.
The Nasdaq Composite (RIXF) rose 17 points, or 0.4%, to
4,276.60.
Stocks rallied on Friday, but Wall Street still closed out the
week with losses, with both the Dow industrials (DJI) and the
S&P 500 index (SPX) dropping 1%. The Nasdaq Composite Index
(RIXF) lost 0.4%.
IBM disappoints: IBM (IBM)'s earnings missed analysts'
expectations, and shares skidded more than 7%. IBM is the
second-biggest component in the Dow industrials.
IBM also said it will sell its global semiconductor technology
business to Globalfoundries, paying $1.5 billion in cash to the
company over the next three years and will reflect a precash tax
charge of $4.7 billion in its third-quarter results.
IBM's faltering stock also may deliver a $1-billion hit to
prominent investor Warren Buffett's Berkshire Hathaway (BRK/A),
which is the largest shareholder in the tech giant, with more than
70 million shares, according to FactSet.
Economic calendar: Dallas Fed President Richard Fisher said
Monday that he will support ending the central bank's bond-buying
program on schedule next week. In an interview on CNBC, Fisher said
he was not troubled by last week's market volatility and did not
think inflation was trending lower. Fed Governor Jerome Powell will
give a speech on community banking to a St. Louis Fed webinar at 10
a.m. Eastern Time.
More earnings: Shares of Hasbro Inc.(HAS) rose 1.8%, after
quarterly results came in better than expected.
Halliburton Co. (HAL) shares rose 1.3% after third-quarter
results were better than Wall Street had expected.
More than 1/3 of Dow stocks to report this week
After the close, Apple Inc. (AAPL) and Chipotle Mexican Grill
Inc. (CMG) will report results. Apple is projected to report fiscal
fourth-quarter earnings of $1.31 a share on sales of $40 billion,
according to a consensus survey by FactSet. What to watch for in
Apple's results Plus: More earnings expectations for Monday
Apple also starts rolling out its Apple Pay system on Monday,
though The Wall Street Journal points out the biggest gap is
department-store cards.
(Read more about the day's notable stocks in Movers &
Shakers column:
http://www.marketwatch.com/story/apple-ibm-chipotle-earnings-in-focus-2014-10-19.)
Other markets: German stocks led fresh weakness in Europe, with
the Stoxx Europe 600 index sinking nearly 1% after business
software maker SAP SE (SAP) lowered its earnings outlook for the
year. (Read more about Europe's big stock movers here:
http://www.marketwatch.com/story/sap-slides-nutreco-surges-europes-big-stock-movers-2014-10-20.)
In Asia, the Nikkei 225 index had a spectacular rebound, surging
nearly 4%, which weakened the yen (USDJPY) and drove investors into
the dollar. Gold(GCZ4) was 0.5% higher, while oil prices(CLX4)
inched lower.
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