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The Dow Now: IBM to Blame for Dow Decline

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Alcoa and Home Depot lead gainers.

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MINYANVILLE ORIGINAL Mixed economic data kept US equities flat in mid-Wednesday trading.

While September housing starts surpassed all expectations in rising 15% to a seasonally-adjusted rate of 872,000, bellwether blue chips IBM (NYSE:IBM) and Intel (NASDAQ:INTC) both reported underwhelming quarterly results.

"If we've had one sector increasingly positive it's been housing, and today's data proves that out again. That said, we're in the middle of earnings season, and that's a bumpier ride now," Art Hogan, market strategist at Lazard Capital Markets, told MarketWatch.

The Dow Jones Industrial Average (INDEXDJX:.DJI) was 0.06% to 13,543.64 points as of 12:02 p.m. EDT, chiefly thanks to IBM's fall.

Unsurprisingly, Home Depot (NYSE:HD) was a big beneficiary of the good housing news, jumping 1.81% to $61.96.

Alcoa (NYSE:AA) also gained 1.83% to $9.10. Shares of the aluminum producer bottomed in June and are slowly but surely on their way back up to $14, says Seeking Alpha.

IBM was the biggest decliner on the day, dragging down the price-weighted Dow with its 4.65% retreat to $201.18. The computer services provider largely met earnings expectations, but revenue fell below consensus estimates. Investors were also disappointed that IBM did not raise its earnings guidance for the full 2012 fiscal year, the first time that it hasn't done so this year.

Similarly, Intel was also hurt by earnings results, falling 2.92% to $21.70. The chipmaker actually exceeded earnings expectations, but its $13.6 billion projection for fourth quarter revenue was lower than the $13.7 billion analysts had expected, which disappointed traders.

Twitter: @sterlingwong
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