NEW YORK – The S&P 500 edged higher for its third straight day of gains on Wednesday, lifted by signs of strength in the housing market, but gains were limited by weak tech company results.
Both Intel Corp and IBM tumbled a day after they reported results, keeping the Dow in negative territory as IBM alone contributed a 66-point drag to the blue chip average.
Intel gave a weak fourth-quarter revenue outlook while IBM posted third-quarter revenue that came in under expectations. Intel slumped 3.8 percent to $21.49 while IBM lost 4.5 percent to $201.48. Both were among the biggest drags on the Dow and Nasdaq.
"These are some fairly big disappointments, and while we think we'll see better results out of tech, it's clear the market doesn't think we'll see much growth in names like Intel or IBM," said Richard Sichel, who oversees $1.8 billion as chief investment officer at Philadelphia Trust Co.
Bank of America rose 0.7 percent in a volatile session after reporting breakeven results, which were sharply lower from the previous year.
The results did little to clarify the strength of the financial sector. Earlier this week, results from Citigroup and Goldman Sachs indicated improvement in the group, though those reports came after disappointments from JPMorgan Chase and Wells Fargo .
Homebuilder Toll Brothers climbed 3 percent to $34.97 after housing starts surged to the fastest pace in four years while D.R. Horton gained 3.7 percent to $21.52.
The Dow Jones industrial average was down 6.38 points, or 0.05 percent, at 13,545.40. The Standard & Poor's 500 Index was up 4.62 points, or 0.32 percent, at 1,459.54. The Nasdaq Composite Index was up 5.58 points, or 0.18 percent, at 3,106.75.
The S&P just notched its best two-day advance in a month, a rise of 1.8 percent. Those gains came as some disappointments early in the earnings season were offset by strong results from such bellwethers as Johnson & Johnson .
Earnings for S&P 500 components are seen falling 2.4 percent from a year ago, with the main culprit the slowing global economy, according to Thomson Reuters data. With 11 percent of S&P companies having reported, 64 percent have beaten earnings expectations, slightly less than the average for the past four quarters.
Apollo Group Inc plummeted 17 percent to $22.85 as the S&P's biggest decliner a day after giving a weak 2013 outlook.
ASML agreed to buy Cymer , its key supplier of a light-based technology crucial to making a new generation of much smaller chips, for $2.5 billion. Cymer surged 58 percent to $75.66.
(Editing by Kenneth Barry)