Stocks waver in afternoon trade; IBM weighs on Dow average

Major U.S. stock indexes shifted between small gains and losses in afternoon trading Tuesday as investors considered the latest batch of company earnings and deal news. Weak earnings or outlooks from companies such as IBM, Harley-Davidson and Lockheed Martin weighed on stocks. The market is coming off a three-day winning streak.

Keeping score: The Dow Jones industrial average slipped 13 points, or 0.1 percent, to 17,216 as of 1:07 p.m. Eastern time. The Standard & Poor's 500 index dipped three points, or 0.2 percent, to 2,029. The Nasdaq lost 25 points, or 0.5 percent, to 4,879.

Earnings crush: Roughly 57 percent of the companies in the S&P 500 index report earnings over the next two weeks. That works out to about 117 companies this week, including Verizon Communications, eBay, Caterpillar and Alphabet.

"The real focal point will continue to be on earnings today," said Eric Wiegand, senior portfolio manager at U.S. Bank Wealth Management.

Sector view: Half of the 10 sectors in the Standard & Poor's 500 index were down. Health care stocks fell the most, 1.4 percent. Telecommunications services stocks led among the gainers, adding about 1 percent.

Memory meld: Investors bid up shares in SanDisk following media reports indicating that the data storage company is in advanced talks to sell itself to rival Western Digital. SanDisk gained $4.02, or 5.6 percent, to $76.02. Western Digital fell $5.6, or 4.5 percent, to $76.

Ready to buy: Team Health Holdings vaulted about 12.1 percent on news that AmSurg is offering to buy the health care staffing and services company in a cash-and-stock deal worth about $7.8 billion. Team Health rose $6.34 to $58.85.

Reboot: IBM shares tumbled 5.8 percent a day after the company's latest earnings report showed that weak hardware sales and a strong dollar brought down its revenue down. It was the 14th straight quarter of revenue declines. The stock weighed heavily on the 30-stock Dow, losing $8.72 to $140.50.

Bumpy ride: Harley-Davidson sank 16.4 percent after the company reported a drop in third-quarter profit and cut its forecasts for motorcycle shipments. Harley shares slid $9.21 to $46.84.

Wincing ahead: Shares in Lockheed Martin fell after the aerospace and defense company reported better-than-expected third-quarter profit but gave a lackluster sales outlook. The stock slid $2.88, or 1.4 percent, to $207.76.

Yum split: Yum Brands, which owns KFC, Pizza Hut and Taco Bell, rose 2.9 percent after saying it plans to spin off its China business, which has stumbled recently. The stock added $2.10 to $73.81.

This new house: The Commerce Department said housing starts rose 6.5 percent last month to a seasonally adjusted annual rate of 1.21 million homes. A 17 percent surge in multi-family housing, which includes apartments, accounts for nearly all of the increase. Homebuilder stocks rose broadly after the report was released. Lennar gained $1.22, or 2.4 percent, to $51.65 and D.R. Horton rose 64 cents, or 2.1 percent, to $31.01.

Overseas markets: In Europe, Germany's DAX fell 0.2 percent, while the CAC-40 in France slid 0.6 percent. The FTSE 100 index of leading British shares dipped 0.1 percent. In Asia, the Shanghai Composite Index rose 1.1 percent, while Tokyo's Nikkei 225 gained 0.4 percent. Hong Kong's Hang Seng shed 0.4 percent.

Energy: Benchmark U.S. crude fell 25 cents to $46.03 a barrel in New York. Brent crude, used to price international oils, slipped 15 cents to $48.46 in London.

Bonds and currencies: U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.07 percent from 2.02 percent the day before. The euro rose to $1.1356 and the dollar rose to 119.84 yen.

By Alex Veiga, AP Business Writer. Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

The Gayly – October 20, 2015 @ 1pm.