FILE- In this Jan. 18, 2019, file photo trader Michael Milano works on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Wednesday, Jan. 23. (AP Photo/Richard Drew, File)

US stock indexes wobble after early gain fades away

January 23, 2019 - 2:26 pm

NEW YORK (AP) — Stocks are mixed in afternoon trading on Wall Street Wednesday after giving up an early gain. Energy companies are down as the price of crude oil falls for the third time in four days after a strong start to 2019.

The Dow Jones Industrial Average had jumped 296 points earlier as investors cheered strong fourth-quarter earnings reports from companies including IBM, consumer products maker Proctor & Gamble, and manufacturer United Technologies.

KEEPING SCORE: The S&P 500 index was unchanged at 2,633 as of 2:15 p.m. Eastern time. The Dow fell as much as 97 points after shedding its initial gain, but later climbed 119 points, or 0.5 percent, to 24,524.

The Nasdaq composite fell 12 points, or 0.2 percent, to 7,008. The Russell 2000 index of smaller-company stocks dipped 5 points, or 0.4 percent, to 1,452.

The S&P 500 fell 1.4 percent Tuesday as investors reacted to signs of slower global economic growth, including a weakened forecast from the International Monetary Fund. They also worried about possible trouble in trade talks between the U.S. and China.

EARN, BABY, EARN: IBM rocketed 8.2 percent to $132.55 after its fourth-quarter results surpassed Wall Street estimates. Investors were also pleased with the company's forecasts for 2019. BMO Research analyst Keith Bachman said critical operations including IBM's business and technology services divisions did well in the quarter. IBM stock sank 25 percent in 2018.

Tide, Bounty and Crest maker Procter & Gamble rallied 4.5 percent to $94.48 after its profit came out ahead of expectations and its sales were well above analyst forecasts as well. The company said its annual profit and sales could be slightly stronger than it previously expected.

Elevator and jet engine maker United Technologies rose 5.1 percent to $116.67 following its report, while media company Comcast jumped 482 percent to $36.67 after it picked up more internet subscribers and got a revenue boost from Sky, its big bet on European TV.

QUARTERLY QUEASINESS: Abbott, which makes Ensure and Pedialyte nutritional shakes, heart devices and medications, fell 2 percent to $70.04 after its revenue disappointed investors. Credit card issuer Capital One shed 5.2 percent to $79.05 after its profit and revenue both fell short of expectations.

THE QUOTE: Liz Ann Sonders, chief investment strategist for Charles Schwab, said corporate profits are growing at a slower clip because of economic weakness in Europe and China and a steep decline in oil prices.

"Even if we end up with the best case scenario on trade, it doesn't alleviate... global growth slowing, earnings uncertainty with regard or 2019, (or) monetary policy," she said.

U.S. company profits got a big boost in 2018 after the passage of the Republican-backed corporate tax cut. The law lowered corporate tax rates permanently, but caused a big one-time increase in profit growth.

Sonders added that consumer confidence has been slipping recently, and the partial shutdown of the federal government, which has lasted more than a month, could make matters worse. Unless there is a deal by Friday, federal employees are about to miss their second paycheck, and a large number of companies who perform contract work for the government will feel the effects and may have to lay off workers.

BONDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.75 percent from 2.73 percent.

SAM'S BACK IN SYNCH: Consumer credit company Synchrony Financial said it's settling a lawsuit filed by Walmart in November, and extending a deal to provide branded credit cards for Walmart's Sam's Club business. Synchrony is also selling its portfolio of Walmart's loans to Capital One. Its stock rose 10.4 percent to $29.30.

U.S-CHINA RELATIONS: White House economic adviser Larry Kudlow denied reports by media outlets including the Financial Times and CNBC saying the U.S. had turned down an offer by Chinese trade officials to meet in Washington this week, due to a lack of progress on issues such as protection of intellectual property. Kudlow said both sides are working toward the higher-level talks. Chinese Vice Premier Liu He and U.S. Trade Representative Robert Lighthizer are scheduled to meet next week.

"It's frustrating for investors who are trying to get a sense of what's happening when you have members of the administration often contradicting each other," said Sonders.

ENERGY: U.S. crude oil lost 1.6 percent to $52.14 per barrel in New York. Brent crude, used to price international oils, fell 1.3 percent to $60.70 per barrel in London.

OVERSEAS: The British FTSE 100 gave up 0.8 percent. France's CAC 40 slipped 0.1 percent and the German DAX shed 0.2 percent. Britain's FTSE 100 lost 0.5 percent.

Japan's Nikkei 225 index shed 0.1 percent. South Korea's Kospi rose 0.5 percent and Hong Kong's Hang Seng was almost flat.

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP

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Annabelle Liang contributed to this story from Singapore.

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