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LONDON (SHARECAST) - US shares closed mixed but with a slightly firmer balance, boosted by the release of much stronger than forecast data on construction starts, which showed a rise to a four-year high.
Housing starts rose 15% in September to an annualised rate of 872,000 units, comfortably ahead of market expectations of 770,000.
Technology giants weigh on DowOn the tech side of things, chip maker Intel and mainframe computing titan International Business Machines (IBM) came under pressure after they issued underwhelming results.
IBM's third quarter net income was unchanged year-on-year at $3.8bn. Revenue fell 5% to $24.7n.
Gross profit margin rose to 47.4% from 46.5% in the corresponding quarter of 2011.
"In the third quarter, we continued to drive margin, profit and earnings growth through our focus on higher-value businesses, strategic growth initiatives and productivity," said Ginni Rometty, IBM Chairman, President and Chief Executive Officer.
"Looking ahead, we see good opportunity with a strong product line-up heading into this quarter and annuity businesses that provide a solid base of revenue, profit and cash. We are reiterating our full-year 2012 operating earnings per share expectation of at least $15.10," Rometty added.
Intel, meanwhile, has been hit by the slump in demand for desktop PCs, where the company's chips are dominant, as users switch to mobile devices, where Intel technology is not so prevalent.
The company said gross margin in the fourth quarter will be about 57%, well short of the 61% or so the market had been forecasting.
Third quarter net income was down to $2.97bn from $3.47bn a year earlier. Sales declined to $13.5bn but were ahead of the $13.2bn the market had been expecting.
Shares of network security firm Checkpoint Software plummeted after it warned that it expects to earn between 83 cents to 91 cents a share (Consensus: 90 cents), excluding one-time items, on revenue in a range of $355m to $387m.
Investors tucked in to Dean Foods after the firm unveiled plans to spin off its Whitewave unit.
Bank of America posted third quarter net earnings of $340m, which came out practically flat (0 cents) on a per-share basis, down from 56 cents per share a year earlier but better than the seven cents per share loss expected by the market. On the other hand, revenue fell short at $20.66bn compared to $28.7bn last year and $21.86bn expected by analysts.
The US bank revealed that it agreed to pay $2.4bn to settle claims that it hid information from shareholders. Part of that money had already been set aside but the bank did take $1.6bn in litigation charges and other extraordinary items that reduced earnings by 28 cents per share.
While Bank of America retreated, Bank of New York Mellon hardened after its earnings came in ahead of expectations.
Commercial education company Apollo Group crashed to an 11-year low after announcing overnight it plans to shed 800 jobs and close 115 campuses and learnng centres, after enrollments declined 14% in the group's fourth quarter.
Much stronger than forecast housing dataHousing starts rose 15% in September to an annualised rate of 872,000 units, comfortably ahead of market expectations of 770,000.
Some economists are warning that this series is still far below its historical average of 1.5m starts. Barclays Research for their part, however, are of the following opinion: This report provides further evidence for our view that a broader housing recovery remains firmly in place
We continue to expect residential investment to be a tailwind for GDP growth in the coming quarters, as it has in the previous five.
Construction permits a leading indicator for the above - increased by 11.6% month-on-month to a rate of 894,000 (Consensus: 810,000).
Large rise in Treasury yieldsFront month West Texas crude futures fell 60 cents to $92.03 a barrel on the NYMEX.
10-year US Treasuries were down by 7/9 of a dollar, with yields at the 1.82% mark, up from 1,72% overnight.
S&P 500 - Risers
Dean Foods Co. (DF) $16.96 +12.77%
Alpha Natural Res (ANR) $9.26 +8.30%
M&T Bank Corp. (MTB) $103.07 +5.83%
Hudson City Bancorp Inc. (HCBK) $8.56 +5.81%
Bank Of New York Mellon Corp. (BK) $24.86 +5.52%
PulteGroup Inc. (PHM) $17.44 +5.31%
First Solar Inc. (FSLR) $25.17 +4.48%
D. R. Horton Inc. (DHI) $21.54 +4.16%
Netflix Inc. (NFLX) $68.52 +3.74%
Peabody Energy Corp. (BTU) $26.85 +3.63%
S&P 500 - Fallers
Apollo Group Inc. (APOL) $21.40 -22.15%
Quest Diagnostics (DGX) $59.75 -5.71%
Textron Inc. (TXT) $24.95 -5.71%
Citrix Systems Inc. (CTXS) $65.05 -5.24%
International Business Machines Corp. (IBM) $200.63 -4.91%
St Jude Medical Inc. (STJ) $40.85 -4.87%
Red Hat Inc. (RHT) $52.21 -4.48%
DeVry Inc. (DV) $22.18 -4.44%
Stanley Black & Decker Inc. (SWK) $69.12 -4.42%
Abbott Laboratories (ABT) $69.04 -4.28%
Dow Jones I.A - Risers
Alcoa Inc. (AA) $9.18 +2.68%
Johnson & Johnson (JNJ) $71.00 +2.08%
Walt Disney Co. (DIS) $52.29 +2.05%
Caterpillar Inc. (CAT) $86.63 +1.97%
Dow Jones I.A - Fallers
International Business Machines Corp. (IBM) $200.63 -4.91%
Intel Corp. (INTC) $21.79 -2.51%
Cisco Systems Inc. (CSCO) $18.69 -0.84%
Nasdaq 100 - Risers
Green Mountain Coffee Roasters Inc. (GMCR) $23.66 +6.29%
Netflix Inc. (NFLX) $68.52 +3.74%
Flextronics International Ltd. (FLEX) $6.28 +2.61%
Staples Inc. (SPLS) $11.59 +2.57%
Alexion Pharmaceuticals Inc. (ALXN) $114.59 +2.55%
Research in Motion Ltd. (RIMM) $7.99 +2.04%
Gilead Sciences Inc. (GILD) $69.58 +1.75%
News Corp. Class A (NWSA) $25.20 +1.74%
DIRECTV (DTV) $51.68 +1.63%
Google Inc. (GOOG) $755.62 +1.47%
Nasdaq 100 - Fallers
Apollo Group Inc. (APOL) $21.40 -22.15%
Check Point Software Technologies Ltd. (CHKP) $41.15 -13.22%
Citrix Systems Inc. (CTXS) $65.05 -5.24%
F5 Networks Inc. (FFIV) $97.45 -3.70%
Symantec Corp. (SYMC) $17.86 -2.51%
Intel Corp. (INTC) $21.79 -2.51%
BMC Software Inc. (BMC) $41.13 -2.11%
Monster Beverage Corp (MNST) $57.20 -2.09%
Oracle Corp. (ORCL) $31.23 -2.01%
Ross Stores Inc. (ROST) $61.81 -1.94%
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