S&P, Nasdaq climb but IBM results weigh on Dow

NEW YORK (Reuters) - U.S. stocks were mixed on Monday as the S&P 500 and Nasdaq advanced, but disappointing results from IBM (IBM.NY)kept the Dow close to the unchanged mark.

IBM shares slumped 7.2 percent to $168.92 as the biggest drag on both the Dow and S&P 500 after third-quarter earnings fell well short of Wall Street expectations. IBM abandoned its 2015 operating earnings target and said it would pay Globalfoundries $1.5 billion over three years to take its loss-making semiconductor unit.

"IBM is in a transition and will need to continue to be in transition to catch up. They are nonexistent in mobile and weak in the cloud and just paid somebody to take their semiconductor business," said Art Hogan, chief market strategist at Wunderlich Securities in New York.

"We can look at earnings misses as they should be viewed, which is company-specific."

At 2:05 p.m., the Dow Jones industrial average <.DJI> fell 6.12 points, or 0.04 percent, to 16,374.29, the S&P 500 <.SPX> gained 12.04 points, or 0.64 percent, to 1,898.8 and the Nasdaq Composite <.IXIC> added 41.75 points, or 0.98 percent, to 4,300.19.

Earnings season will ramp up significantly this week, with nearly 130 S&P 500 companies scheduled to report, including Apple Inc after the close Monday.

According to Thomson Reuters data through Monday morning, of 87 companies in the S&P 500 that have reported quarterly earnings, 63.2 percent beat analyst expectations, roughly even with the 63 percent average since 1994 but below the 67 percent rate for the past four quarters.

Third-quarter earnings are expected to grow 6.7 percent from a year ago, on revenue growth of 3.6 percent.

The largest percentage gainer on the S&P 500 was Tesoro Corp , which rose 6.2 percent, while the largest percentage decliner was IBM.

The largest gainer on the Nasdaq 100 was Celgene , which rose 4.6 percent, while the largest decliner was Regeneron Pharma , down 1.8 percent.

Among the most active NYSE stocks were Bank of America , up 0.25 percent to $16.25; Petrobras , down 3.75 percent to $14.37; and Oi S.A. , down 7.41 percent to $0.47.

On the Nasdaq, Apple , up 1.7 percent to $99.34 and Facebook , up 1.0 percent to $76.73, were among the most actively traded.

Advancing issues outnumbered declining ones on the NYSE by 2,072 to 962, for a 2.15-to-1 ratio on the upside; on the Nasdaq, 1,645 issues rose and 988 fell for a 1.66-to-1 ratio favoring advancers.

The benchmark S&P 500 index was posting 2 new 52-week highs and 2 new lows; the Nasdaq Composite was recording 15 new highs and 32 new lows.

(Editing by Bernadette Baum and Nick Zieminski)