Wall Street up on ECB bets but details, IBM cap gains

By Rodrigo Campos

NEW YORK (Reuters) – U.S. stocks edged up in a choppy Wednesday session as traders digested reports that new stimulus would be announced by the European Central Bank at its Thursday meeting, while declines in IBM and Microsoft also limited the gains.

Market participants have been looking for more aggressive measures from central banks, specifically the ECB, to combat the risk of deflation and a weakening euro zone economy. A source told Reuters that the ECB’s Executive Board has proposed a program that would enable the bank to buy 50 billion euros ($ 58 billion) in bonds per month starting in March. ECB President Mario Draghi will speak to the media at 1330 GMT (8:30 a.m. EST) on Thursday.

“The ECB rumor was very important. The market’s perception was that Draghi was going to disappoint tomorrow in the magnitude” of the program, said Phil Orlando, chief equity market strategist at Federated Investors in New York.

He said, regardless of the size of the expected purchase program, there are many details in terms of the assets available for purchase and how those will affect individual members of the bloc.

“The rules of the game may not be as fortuitous as investors and Draghi might like to be able to get the most bang for the buck.”

U.S. stocks would benefit from a program in support of a stronger euro zone economy because Europe is one of the United States’ most important trade partners.

At 3:03 p.m. EST the Dow Jones industrial average <.DJI> rose 25.4 points, or 0.15 percent, to 17,540.63, the S&P 500 <.SPX> gained 8.35 points, or 0.41 percent, to 2,030.9 and the Nasdaq Composite <.IXIC> added 12.28 points, or 0.26 percent, to 4,667.12

S&P 500 energy shares <.SPNY> were the day’s best performers, up 1.5 percent alongside a 2.5 percent gain in the price of U.S. crude futures <CLc1>. The S&P 500 oil and gas exploration and production index <.SPLRCOILP> rose 2.7 percent.

Despite the advance, crude futures remain on track to post their fifteenth negative week in the last 17.

IBM shares <IBM.N> fell 3.1 percent to $ 152.16 the day after reporting lower-than-expected revenues and giving a 2015 profit target that was below estimates. The stock was among the biggest decliners on the S&P 500 and weighed the most on the price-weighted Dow industrials.

The blue-chip index, however, got a boost from UnitedHealth Group Inc <UNH.N>, which rose 3 percent to $ 108.81 after its fourth-quarter earnings topped expectations.

Netflix Inc <NFLX.O> jumped 17 percent to $ 408.01 a day after the streaming and rental video company posted earnings that were above expectations and said it was growing faster overseas than previously expected.

Advancing issues outnumbered declining ones on the NYSE by 1,871 to 1,167, for a 1.60-to-1 ratio; on the Nasdaq, 1,547 issues fell and 1,164 advanced, for a 1.33-to-1 ratio favoring decliners.

The S&P 500 was posting 36 new 52-week highs and 9 new lows; the Nasdaq Composite was recording 38 new highs and 89 new lows.

(Additional reporting by Lucas Iberico Lozada; Editing by Nick Zieminski)