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At midday: Technology stocks rally after earnings

A pedestrian walks past International Business Machines Corp. offices in New York. IBM benefits from long-term customer relationships that generate recurring revenue.

Scott Eells

North American stocks were mixed in midday trading on Wednesday, even though key U.S. technology names rallied on strong earnings and forecasts.

Shortly after noon, the S&P 500 was almost unchanged, at 1493. The blue-chip Dow Jones industrial average was up 61 points or 0.5 per cent, to 13,773. In Canada, the S&P/TSX composite index was down 18 points or 0.1 per cent, to 12,807.

The Federal Housing Finance Agency reported that U.S. home prices rose 5.6 per cent in November, year-over-year, providing additional evidence that the country's housing market continues to recover from a deeply depressed state.

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Within the S&P 500, technology stocks showed the biggest gains, rising 1.1 per cent.

International Business Machines Corp. rose 5.1 per cent – marking its best one-day move in nearly four years – after the technology giant provided a better-than-expected forecast on Tuesday evening, when it also released upbeat earnings.

Google Inc. rose 6.5 per cent after the technology and search engine company reported its quarterly results on Tuesday evening. It reported earnings of $10.65 (U.S.) a share, after excluding some one-time items, which topped expectations.

Apple Inc. rose 0.8 per cent ahead of its quarterly financial report, due to be released on Tuesday after markets close.

Elsewhere in the S&P 500, utilities fell 0.5 per cent, consumer discretionary stocks fell 0.4 per cent and financials fell 0.2 per cent.

Coach Inc. fell 15 per cent after the handbag retailer reported quarterly earnings and sales that missed expectations, placing most of the blame on slow growth in the U.S. market.

Within Canada's benchmark index, telecom stocks rose 0.5 per cent and energy stocks rose 0.1 per cent. Financials fell 0.2 per cent and materials fell 0.7 per cent.

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In Europe, the U.K.'s FTSE 100 rose 0.3 per cent and Germany's DAX index rose 0.2 per cent.

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About the Author
Investing Reporter

David Berman has been writing about business and investing since 1995. He has written for a number of magazines, including Canadian Business and MoneySense. He worked at the Financial Post as an investing writer and daily columnist before moving to the Globe and Mail in 2008. More

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