Dow falls due to weakness in IBM, oil shares

NEW YORK (AFP) - The Dow slid on Wednesday (April 19) following disappointing IBM earnings and a pullback in petroleum-linked shares due to a steep drop in oil prices.

IBM slumped 4.9 per cent as it reported a 13 per cent drop in first-quarter profit to US$1.8 billion (S$2.5 billion) and suffered its 20th straight quarter of year-over-year revenue declines.

Fellow blue-chip companies ExxonMobil and Chevron dropped a respective 0.7 per cent and 1.4 per cent as a US petroleum inventory report showing higher gasoline supplies pressured oil prices.

Analysts also cited lingering worries about geopolitical issues, including Sunday's first round of the French presidential election which has implications for the future of the eurozone.

The Dow Jones Industrial Average dropped 0.6 per cent to 20,404.49.

The broad-based S&P 500 dipped 0.2 per cent to 2,338.17, while the tech-rich Nasdaq Composite Index added 0.2 per cent at 5,863.03.

Twenty-First Century Fox fell 0.8 per cent as Fox News severed its relationship with Bill O'Reilly, dumping America's most-watched cable news anchor after a flood of sexual-harassment allegations and an advertiser boycott.

Morgan Stanley rose 1.9 per cent after reporting a 74.4 per cent increase in first-quarter earnings on strong trading results.

Semiconductor company Lam Research surged 6.9 per cent after reporting better-than-expected quarterly earnings and surprising the market with a bullish forecast for the current quarter.