Updated from 4:10 p.m. EDT
Dow Jones Industrial Average
wasn't able to close above 12,000 Wednesday, but a strong showing by
did lift the index to its eighth new high in the past two weeks.
After jumping out of the gate to an intraday record of 12,049.51, the Dow pulled back. Still, the industrials finished the day ahead by 42.66 points, or 0.36%, at 11,992.68, another record close.
Only half of the index's 30 components ended with gains. IBM and
Johnson & Johnson
were the Dow's biggest winners, each up more than 3%.
tacked on 1.91 points, or 0.14%, to 1365.96, and the
gave up 7.80 points, or 0.33%, to 2337.15 after having been up as many as 17 points earlier. The Nasdaq was pressured by a 22% drop in
"The reaction to earnings reports is more important than the actual news," said Barry Hyman, equity market strategist with EKN Financial. "We came into this earnings season waiting to see what reaction we'd have. So far, it seems to be a sell-on-the-news scenario. We could be looking at further consolidation over the next few days as earnings continue to come in."
Volume and breadth improved slightly from the previous day's levels. About 2.52 billion shares changed hands on the
New York Stock Exchange
, with advancers outpacing decliners by a 9-to-7 margin. Volume on the Nasdaq was roughly 2.17 billion shares, and winners and losers essentially tied.
At the open of the session, big tech names and a tame report on consumer-level inflation spurred early buying. The Labor Department said the consumer price index for September was down 0.5%, compared with expectations for a decline of 0.3%. The so-called core index, which excludes food and energy prices, rose 0.2%, in line with estimates.
The data swing the pendulum back toward the doves in the debate about the
next interest rate move. Policymakers have said incoming economic data are their primary focus in the run-up to the two-day Fed meeting next week.
Peter Morici, a professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission, said that the core CPI growth year over year remains above Fed Chairman Ben Bernanke's target range of 1% to 2%.
"However, core consumer price inflation in recent months reflected the continuing pass-through of prior surges in energy prices to nonenergy products," he said in an emailed statement. "Those pressures are now reversing."
After hovering around the unchanged mark after the CPI report, the 10-year Treasury finished up 2/32 in price, yielding 4.76%. The dollar was slightly higher against the yen and the euro.
On Tuesday, a hotter-than-expected reading on core producer prices buried stocks, as investors remained fixated on the future of the Fed's rate policy. For the session, the Dow lost 30.58 points to 11,950.02, and the S&P 500 was off 5 points at 1364.05. The Nasdaq fell 18.89 points, or 0.8%, to 2344.95.
To view Gregg Greenberg's video take on today's market, click here
Trying to support the bull case were technology giants IBM,
. After the close of trading, all three posted quarterly results and gave investors something to cheer.
Leading the way was IBM, which easily beat analysts' third-quarter earnings forecast and surpassed revenue estimates. At Intel, profits fell by 35% in the third quarter, but the chipmaker still topped expectations by 4 cents. Intel's sales of $8.7 billion were at the high end of its guidance.
IBM set a new 52-week high of $92.04 before closing at $89.82, up $2.87 or 3.3%. Intel tacked on 21 cents, or 1%, to $21.06.
Yahoo!'s promise to roll out a once-delayed search-technology upgrade was a positive, but the company's weak results disappointed investors. The company missed analysts' third-quarter revenue target and guided below sales estimates for the fourth quarter.
Yahoo! also set plans for a $3 billion stock buyback and said its eagerly anticipated Project Panama upgrade is on track for release this winter. Shares lost $1.16, or 4.8%, to close at $22.99.
Despite several signs of hope coming from tech land, one name had a disastrous afternoon.
fell 4.9% after it missed analysts' third-quarter sales and handset-shipment targets.
The wireless giant earned $727 million, or 29 cents a share, from continuing operations for the quarter ended Sept. 30, down from last year's $1.74 billion, or 68 cents a share. Motorola dropped $1.22 to $23.63.
Away from tech, Dow component
posted third-quarter earnings of $3.3 billion, or 92 cents a share, up 32% from a year ago. Results beat the Thomson First Call average estimate for EPS of 86 cents. Net revenue rose 8% to $15.4 billion.
However, Chief Financial Officer Mike Cavanaugh said he expects fourth-quarter results to be "a little lower" than the third quarter. Shares of JPMorgan finished down 78 cents, or 1.6%, to $47.21.
After the market closes, earnings reports are expected from
Advanced Micro Devices
Returning to the economic front, the Commerce Department said U.S. housing starts unexpectedly jumped 5.9% in September to 1.77 million annualized units. Economists expected new homes to fall to 1.65 million annualized units from 1.66 million in August.
Commodities were mostly lower, with oil prices extending their recent skid. In Nymex floor trading, crude tumbled $1.28 to close at $57.65 a barrel, while gasoline was unchanged at $1.47 a gallon. Gold reversed early strength and shed 90 cents to $592.60 an ounce, while silver added 4 cents to $11.82 an ounce.
The Energy Department's weekly report on U.S. fuel inventories showed a greater-than-expected 5.1 million-barrel increase in crude stocks, an unexpected 5.2 million-barrel decrease in gasoline stocks, and a larger-than-expected 4.5-million-barrel decline in distillate inventories.
Overseas markets were higher. London's FTSE 100 was up 0.7% to 6150, and Germany's Xetra DAX rose 1.1% to 6183. In Asia, Japan's Nikkei gained 0.3% overnight to 16,653, while Hong Kong's Hang Seng added 0.2% to 18,048.