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US STOCKS-Wall St little changed as earnings gain momentum
October 20, 2015 / 3:25 PM / 2 years ago

US STOCKS-Wall St little changed as earnings gain momentum

* IBM slumps after results, biggest drag on Dow, S&P 500

* Verizon, Travelers, United Tech up after results

* Yum Brands jumps on plans to spin off China business

* Harley Davidson down on cut to shipment forecast

* Dow up 0.15 pct, S&P up 0.2 pct, Nasdaq down 0.05 pct (Adds details, changes comment, updates prices)

By Abhiram Nandakumar

Oct 20 (Reuters) - U.S. stocks were little changed on Tuesday as Verizon and United Technologies rose after strong quarterly results, limiting the losses caused by IBM’s disappointing results and lowered forecast.

Third-quarter company earnings are in focus this week, with investors keeping an eye on revenue growth and outlook commentary on the effects of a global economic slowdown.

S&P 500 companies are expected to show a 3.9 percent fall in third-quarter profit while revenue is expected to fall 3.8 percent, according to Thomson Reuters data.

“It is topline growth that is making these companies and the market see-saw back and forth as they report,” said Chris Bertelsen, chief investment officer at Global Financial Private Capital.

“They can’t get away with just bottom line good numbers anymore because everyone’s looking for growth,” Bertelsen said.

Verizon’s shares were up nearly 2 percent at $45.49 after the largest U.S. wireless service provider reported better-than-expected revenue and profit.

The stock gave the biggest boost to the telecom sector . Six of the 10 major S&P sectors were up, led by telecom sector’s 1.33 percent rise.

United Technologies rose 1.4 percent to $93.34 after its quarterly profit beat expectations. The stock provided the biggest boost to the Dow Jones industrial average.

IBM fell nearly 6 percent to $140.86 after it reported a bigger-than-expected fall in quarterly revenue.

Travelers rose 2.2 percent to $108.65 after the insurer’s quarterly profit topped estimates, helped by higher underwriting gains.

At 10:59 a.m. ET (1459 GMT), the Dow Jones industrial average was up 25.29 points, or 0.15 percent, at 17,255.83, the S&P 500 was up 3.97 points, or 0.2 percent, at 2,037.63 and the Nasdaq composite index was down 2.44 points, or 0.05 percent, at 4,903.04.

Tech earnings gather steam as Yahoo and VMware report results after the close on Tuesday.

Of the S&P 500 companies that have reported until Friday, 43 percent have beaten expectations on revenue, according to Thomson Reuters data. About 60 percent companies on average beat sales estimates in a quarter.

U.S. stocks closed with slight gains on Monday as tech and biotech stocks advanced ahead of a heavy week of earnings.

Data on Tuesday showed U.S. housing starts rose 6.5 percent to a seasonally adjusted annual pace of 1.21 million units in September.

Harley Davidson skidded 11.6 percent to $49.54 after the motorcycle maker cut its full-year shipment forecast.

Yum Brands rose 4.1 percent to $74.64 after the fast food group said it was preparing to separate its China business.

Sandisk jumped 5.3 percent to $75.80 after a Reuters report said Western Digital was in advanced talks to buy the memory chipmaker, citing people familiar with the matter. Western Digital fell 4 percent to $77.30.

Advancing issues outnumbered decliners on the NYSE by 2,012 to 886. On the Nasdaq, 1,431 issues rose and 1,126 fell.

The S&P 500 index showed 20 new 52-week highs and three new lows, while the Nasdaq recorded 43 new highs and 23 new lows. (Reporting by Abhiram Nandakumar in Bengaluru; Editing by Don Sebastian)

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