BANKS COME BACK: Wealth management and investment banking firm Morgan Stanley said its profit jumped in the first quarter as its stock and bond trading businesses made about twice as much money as they did one year ago.
IBM will have an out-sized influence on the Dow Industrials Wednesday, much like Goldman Sachs did on Tuesday, as the technology bellwether's shares dive on disappointing first-quarter results. Of the 45 S&P 500 companies that have released results, almost 76 percent have topped earnings estimates, according to Thomson Reuters I/B/E/S.
Shares of IBM IBM.N sank 5 percent to $161.75 after the company reported a bigger-than-expected decline in revenue for the first time in five quarters.
The Standard & Poor's 500 index fell 4 points, or 0.2 percent, to 2,338. The losses accelerated after the mid-afternoon release of the Federal Reserve's "Beige Book" survey of economic conditions.
In other energy trading, wholesale gasoline fell 5 cents, or 3 percent, to $1.66 a gallon.
Bond prices fell. The yield on the 10-year Treasury rose to 2.21 percent.
Morgan Stanley (MS.N) rose 2 percent after posting a surge in quarterly profit, taking some of the sting out of a disappointing report from Goldman Sachs on Tuesday.Of the 57 companies in the S&P 500 that have reported earnings through Wednesday morning, 75.4 percent have topped expectations, according to Thomson Reuters data, above the 71 percent average for the past four quarters.
BONDS: Bond prices fell, reversing most of their gains from a day earlier. Basic materials companies rose behind gains for packaging companies WestRock, which added $2.44, or 4.8 percent, to $53.07 and International Paper, which rose $1.11, or 2.2 percent, to $52.56. Financials, which had been the lead gainer earlier in the session, was only up 0.1% by mid-session. That helped banks but hurt high-dividend companies including utilities and real estate investment trusts.
OIL: Oil prices dropped after the Energy Information Administration said US crude inventories didn't shrink as much as investors hoped they would, and the EIA says the stockpiles are larger than normal for this time of year. Shares of other big United States banks rose in tandem.
"To me, fundamentally, I think the Toronto Stock Exchange is going to be hard pressed to move significantly higher", based on expectations for a strong US dollar, higher interest rates and lower oil prices, said Allan Small, a senior investment advisor at HollisWealth.
On the flipside, shares of Morgan Stanley rose, trading 2.8 percent stronger as of 1.54pm in NY, as the bank posted stronger-than-expected earnings bolstered by bond trading revenue. The euro edged down to $1.0711 from $1.0730.
The pan-European STOXX 600 index .STOXX , which hit a three-week low on Tuesday, ended up 0.2 percent.
OVERSEAS: British stocks continued to fall. Gold futures (http://www.marketwatch.com/story/gold-slides-as-dollar-recovers-but-geopolitics-keep-a-floor-under-metals-2017-04-19) lost ground, as a key dollar index gained. In France the CAC-40 edged up 0.3 percent and Germany's DAX gained 0.2 percent.
Hang Seng Index was down 0.41%.
Nikkei 225 was up 0.07%.