Economy
S&P, Nasdaq up as banks and techs gain; IBM dents Dow

S&P, Nasdaq up as banks and techs gain; IBM dents Dow


Gains in financial and technology stocks kept the S&P 500 and the Nasdaq firmly positive on Wednesday, while a slump in IBM held back the Dow. The advance in financials was underpinned by a 2.6 percent jump in shares of Morgan Stanley (MS.N), which reported a surge in quarterly profit. Shares of other big U.S. banks rose in tandem. Morgan Stanley's solid results provided some succor to investors stung by weak results at chief rival Goldman Sachs (GS.N) a day earlier. IBM (IBM.N) sank nearly 6 percent to $16.06 after the company reported a bigger-than-expected decline in revenue for the first time in five quarters. The stock was the biggest drag on the Dow and the S&P. "It's really a battle between geopolitical headlines and earnings right now, and for the most part earnings seem to be winning in the short term," said Jeff Zipper, managing director of investments at the Private Client Reserve of U.S. Bank in Palm Beach Florida. Mounting tension between North Korea and the United States and political uncertainty in Europe ahead of the French presidential elections had kept safe-havens such as gold and U.S. Treasuries in demand in the past weeks. At 11:01 a.m. ET, the Dow Jones Industrial Average .DJI was down 23.46 points, or 0.11 percent, at 20,499.82, the S&P 500 .SPX was up 6.27 points, or 0.27 percent, at 2,348.46 and the Nasdaq Composite .IXIC was up 35.50 points, or 0.61 percent, at 5,884.97. With Wall Street near record levels and worries over President Donald Trump's ability to carry out his pro-growth promises, investors are hoping first-quarter earnings will be strong enough to justify pricey market valuations. So far, the results have been promising. Of the 45 S&P 500 companies that have released results, nearly 76 percent have topped earnings estimates, according to Thomson Reuters I/B/E/S. Overall profits of S&P 500 companies are estimated to have risen 10.7 percent in the quarter - the best since 2011. Eight of the 11 major S&P 500 sectors were higher. Utilities .SPLRCU, real estate .SPLRCR and consumer staples .SPLRCS, which have outperformed the broader index since Monday, were down. Facebook (FB.O) was up 1.3 percent and provided the biggest boost to the S&P and the Nasdaq. Intuitive Surgical (ISRG.O) was up 7.3 percent at $814.49 after the company reported higher-than-expected first-quarter revenue and profit. American Express (AXP.N), eBay (EBAY.O) and Qualcomm (QCOM.O) are scheduled to report results after the market closes. In economic data, the Federal Reserve's Beige Book, which will give a glimpse into economic conditions across the United States, is due at 2:00 p.m. ET. Advancing issues outnumbered decliners on the NYSE by 1,753 to 997. On the Nasdaq, 1,838 issues rose and 766 fell. The S&P 500 index showed 19 52-week highs and one low, while the Nasdaq recorded 53 highs and 22 lows.