Wall St eases on IBM, Intel; Chesapeake slumps
By Edward Krudy
NEW YORK (Reuters) - U.S. stocks were lower on Wednesday after uninspiring earnings from IBM and Intel, while Chesapeake Energy slumped after a Reuters report highlighted large and unusual personal loans taken by its chief executive.
International Business Machines Corp and Intel Corp were the biggest drags on the Dow. IBM missed its revenue forecast, while investors said Intel's results failed to make a "bull case" for the stock.
The lackluster reports from the two technology heavyweights came at the start of what has been a strong earnings season. The S&P 500 had its best day in a month on Tuesday as Coca-Cola Co led the day's round of solid earnings and as concerns eased over the euro zone debt crisis.
Bruce Bittles, chief investment strategist at Robert W. Baird & Co in Nashville, Tennessee, expects the market to continue its back-and-forth, possibly trending lower in the second quarter after strong gains earlier in the year.
"A consolidation or correction phase in the second quarter would make the most sense, and probably it would be the most healthy thing for the market," he said.
Market breadth was worse than the relatively slight losses suggested in the late morning. On the New York Stock Exchange, two stocks declined for every one that rose.
Chesapeake Energy Corp slumped nearly 9 percent to $17.40 after Reuters reported that CEO Aubrey K. McClendon did not disclose loans of as much as $1.1 billion over the last three years against his stake in thousands of company oil and natural gas wells.
Chesapeake was the most actively traded stock on the NYSE, outstripping even Bank of America with its massive share float. Continued...