By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks fluctuated on Wednesday,
trading in a narrow range, as disappointing earnings from IBM and
Coach Inc. dampened the mood.
The S&P 500(SPX) was up less than a point at 1,844.13. The
Dow Jones Industrial Average(DJI) fell 34 points, or 0.2%, to
16,380.21. The Nasdaq Composite(RIXF) was up 8 points, or 0.5%, at
4,234.66.
Disappointing results from IBM weighed on blue chips. Shares of
IBM (IBM) skidded 3.2% after the company reported fourth-quarter
revenue that fell short of estimates and disappointed with its
earnings outlook.
Off the Dow, Coach (COH) shares slumped 6.4% after the company
said second-quarter sales fell 6%. The company said its North
America performance continues to disappoint.
"Earnings have been mildly disappointing, and the reason we are
not seeing a more pronounced sell-off is because investors went in
to the season with low expectations. The last quarter of 2013 was
affected by the government shutdown, tough weather, fewer holiday
shopping days, all of which led companies to lower their outlooks,"
said Jim Russell, senior equity strategist for U.S. Bank Wealth
Management.
"At this point, investors are overlooking the fourth-quarter
earnings, because they are focused on this year's profits and the
pictures is more encouraging. Companies are hiring more, capital
expenditures are expected to rise and we are seeing more M&A
activity. This year, markets will be more earnings driven than
valuations driven," he added.
VMware(VMW) shares rose 2% after the software company said it
would buy AirWatch for about $1.54 billion. The firm also announced
its fourth-quarter revenue estimates at the high end of its
previous outlook.
Shares in Super Micro Computer Inc. (SMCI) soared 21.1% after
the maker of servers reported that profit in the latest quarter
doubled, topping Wall Street expectations. The company's fiscal
third-quarter outlook was also upbeat.
Advanced Micro Devices (AMD)(AMD) sank 10.9% after the chip
maker said it expects first-quarter revenue to decline 13% to 19%
from its fourth-quarter result.
Shares of United Technologies (UTX) rose 1% after it reported
fourth-quarter earnings fell 29% despite stronger revenue.
Shares in U.S. Bancorp (USB) fell 0.4% after the bank reported a
modest rise in profit thanks to lower tax costs and credit-loss
provisions, but said revenues sank due to a decline in refinancing
activity.
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After the market close, eBay Inc. (EBAY) and Netflix Inc. (NFLX)
will report. Read: New U.S. subscribers will be key to Netflix
results.
In overseas markets, Europe stocks kept a slippery hold on
gains, while Asia saw a mostly up day. Stocks in Tokyo rose after
the Bank of Japan kept its policy and asset-purchase program
unchanged.
Natural-gas futures continued to march higher as another
snowstorm hit the East Coast, which could also cause some commuter
woes for New York traders on Wednesday. Oil moved higher, while
gold drifted lower. The British pound (GBPUSD) surged against the
dollar after a sharp drop in U.K. unemployment, which could put
Bank of England interest-rate hikes back on the table.
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