- IBM, AMD provide a drag as outlooks disappoint
- Markets awaiting data due Thursday
- Treasury yields rise from six-week low
Dow Jones: -0.30%
S&P 500: -0.07%
US indices opened broadly flat on a quiet day for macro news, as markets focused on an influx of corporate earnings including disappointing figures from tech heavyweights International Business Machines (IBM) and Advanced Micro Devices (AMD).
According to Market Analyst Craig Erlam from Alpari UK, earnings will be the key driver of sentiment today "as investors continue to look for evidence that the economic recovery will continue this year".
"The period of ultra-low interest rates appears to be coming to an end as the Federal Reserve winds down its quantitative easing (QE) programme and passes the baton to US companies to carry on the recovery," he said.
US Treasury yields bounced off a six-week low amid speculation that the Fed will continue to scale back QE at its policy meeting next week in the face of an improving economy.
The yield on a benchmark 10-year US bond was up two basis points at 2.85% early on, ahead of data due out on Thursday which is expected to show a pick-up in US manufacturing growth and a rebound in existing-home sales. Jobless claims and the leading indicators index are also due out tomorrow.
IBM, AMD and Coach fall early on
Tech giant IBM slumped after the computer-services provider posted a 5% drop in revenue in the fourth quarter to $27.7bn, missing the $28.25bn expected by the market. While earnings per share beat expectations by rising 14% to $6.13, the firm gave a cautious outlook for current-quarter profits.
IBM's senior executives including Chief Executive Ginni Rometty chose to give up their bonuses.
AMD saw its share price sink by over a tenth despite beating fourth-quarter profit estimates after it predicted that revenues in the first quarter of 2014 would fall by around 16%.
Luxury fashion group Coach Inc. sank sharply after reporting fiscal second-quarter earnings and revenues declined, missing analysts' forecasts, as weakness in US women's bag and accessories sales offset growth elsewhere.
Nuance Communications edged higher after the provider of voice applications to corporate customers forecast first-quarter earnings that exceeded market expectations.
Motorola Solutions gained after the maker of walkie-talkies and rugged mobile computers reported a slight rise in quarterly profit, driven by higher government sales.
BlackBerry rallied as the struggling smartphone maker said it plans to sell most of its Canadian real estate to raise cash for its turnaround plan.