NEW YORK – A surprisingly strong housing report helped push the stock market mostly higher Wednesday, while weak earnings reports from Intel and IBM weighed on the Dow Jones industrial average.
Even though the two tech giants disappointed, overall earnings results have come in much better than some investors had feared, said Dan Veru, chief investment officer at Palisade Capital Management in Fort Lee, N.J.
“Everyone is breathing a sigh of relief that things aren’t all that bad,” Veru said.
The Dow edged up 5.22 points to close at 13,557, barely managing its fourth straight day of gains. The broader Standard & Poor’s 500 index gained 5.99 points to 1,460.91.
Better results from Mattel, Goldman Sachs and Johnson & Johnson shot the stock market higher Tuesday. For the week, the Dow is up 1.7 percent, and the S&P 500 is up 2.3 percent.
Heading into this earnings season, FedEx, Caterpillar and other global heavyweights had warned investors that China’s slowing economy and Europe’s ongoing debt crisis would weigh on quarterly profits.
Analysts still expect that third-quarter earnings for companies in the S&P 500 will shrink for the first time since 2009.
IBM reported sales late Tuesday that missed Wall Street’s expectations. On a call with analysts, IBM’s chief financial officer said the company faced “more challenging” market conditions in September, the final month of the quarter, as cautious customers and a weakening euro undercut its results. IBM’s stock sank $10.37 to $200.63.
Without IBM’s drop, the Dow would have been 79 points higher. Stocks with higher prices carry more weight in the average of 30 large companies. Every move of $1 in any Dow stock is equivalent to moving the Dow average 7.68 points.
Intel warned that sales of personal computers will likely remain weak during the holiday season this year. The chipmaker cut its revenue estimates for the year-end quarter when it reported results late Tuesday. Intel’s stock fell 56 cents to $21.79.
In other trading, the Nasdaq composite index inched up 2.95 points to 3,104.12. More than two stocks rose for every one that fell on the New York Stock Exchange.
The housing report helped lift the yield on the 10-year Treasury note to 1.81 percent from 1.72 percent late Tuesday. Better economic news usually sends traders out of safe assets like Treasurys, and when bond prices fall their yields rise.
The 10-year Treasury yield, a standard benchmark for mortgages and other loans, started October at 1.63 percent.
Among other companies making big moves Wednesday:
• Dean Foods led all stocks in the S&P 500 with a 13 percent jump. The dairy company offered more details about its planned spin-off of a subsidiary, WhiteWave, the producer of Silk Soymilk. Dean Foods said it will keep at least 80 percent of WhiteWave after the company’s initial public offering. The company’s stock rose $1.92 to $16.96.
• The University of Phoenix’s parent company, the Apollo Group, plunged 22 percent, the biggest drop in the S&P 500. A sharp drop in student enrollment has cut into profits, Apollo reported late Tuesday. To cope with shrinking enrollment, Apollo plans to close 115 of the university’s mostly smaller locations. Its stock lost $6.09 to $21.40.
• Bank of New York Mellon surged $1.30 to $24.86 after reporting net income and revenue that topped analysts’ estimates.