US stocks ended higher yesterday on investor hopes for a strong earnings season, but IBM’s disappointing results limited gains.
Earnings reports from Halliburton, Gannett, and others, helped ease the worries over global growth and falling commodity prices that last week helped drive stocks close to correction territory.
Texas Instruments posted third-quarter revenue of $3.5bn, up 8 percent from the year-ago period, and above expectations on Wall Street following recent concerns about weak industry demand.
“Some of the concerns of last week have subsided,” said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.
“The more people just focus on the fundamental values and earnings and revenues and less on headlines, the more stocks have an opportunity to move higher.”
IBM shares slumped 7.1 per cent to $169.10, the biggest drag on both the Dow and S&P 500, after third-quarter earnings fell well short of Wall Street expectations. IBM abandoned its 2015 operating earnings target and said it would pay Globalfoundries $1.5bn over three years to take its loss-making semiconductor unit.
The Dow Jones industrial average rose 19.26 points, or 0.12 per cent, to 16,399.67, the S&P 500 gained 17.25 points, or 0.91 per cent, to 1,904.01 and the Nasdaq Composite added 57.64 points, or 1.35 per cent, to 4,316.07.
Small caps also rebounded, with the Russell 2000 up 1.2 per cent.
The CBOE Volatility index fell 15.5 per cent.