U.S. stocks rise despite disappointing IBM earnings

U.S. stocks managed to close higher on Monday, despite disappointing quarterly earnings from tech giant International Business Machines Corporation (IBM).

Shrugging off the earnings of the economic bellwether, a component of the blue-chip index, the Dow Jones Industrial Average eked out a modest gain, up 19.26 points, or 0.12 percent, to 16, 399.67, which underperformed the other two indices.

The S&P 500 increased 17.25 points, or 0.91 percent, to 1,904. 01, after having seen the longest weekly losing streak since 2011. The Nasdaq Composite Index soared 57.64 points, or 1.35 percent, to 4,316.07.

The IBM reported before the opening bell that its third-quarter diluted earnings from continuing operations were 3.46 U.S. dollars per share, a decrease of 8 percent from 3.77 dollars per share a year ago. On an adjusted basis, the IBM reported earnings of 3.68 dollars per share, missing analysts' expectations of 4.31 dollars per share.

Its third-quarter revenue fell 4 percent year over year to 22.4 billion dollars, also trailing market forecast. In response, IBM shares slumped 7.11 percent to 169.10 dollars apiece.

With no major economic data in the day, investors are looking to a busy week of corporate earnings, with nearly 130 S&P 500 companies expected to report quarterly results this week, including Dow components Coca-Cola Co., McDonald's Corp., Boeing Co. and Caterpillar.

After the closing bell, Apple delivered better-than-expected earnings, with earnings per share of 1.42 dollars for its fiscal 2014 fourth quarter versus 1.31 dollars and revenues of 42.12 billion dollars above expectations of 39.88 billion dollars. Shares of the iPhone maker advanced in after-hours trading.

Goldman Sachs cut its target for the 10-year U.S. Treasury yield at the end of 2014 to 2.5 percent from 3 percent, reflecting recent worries that the U.S. economy may not grow as robust as expected amid weak demand overseas.

In the past couple of weeks, restless investors scrambled to U. S. government bonds, the so-called safe haven assets, amid increasing deflation pressure in the euro zone and faltering global growth prospect, driving the 10-year U.S. Treasury yield lower.

Investors had anticipated rising U.S. bond yields, based on a strengthening recovery in the U.S. economy and the Federal Reserve 's plan to exit from its massive bond buying programs in late October.

In the past week, the Dow, the S&P 500 and the Nasdaq Composite Index fell 1.0 percent, 1.0 percent and 0.4 percent, respectively, as investors were spooked by lingering global growth concerns.

The CBOE Volatility Index, often referred to Wall Street's fear gauge, fell 15.55 percent to end at 18.57 on Monday.

In other markets, the dollar was mixed against other currencies as no major economic data were released.

Ahead of the Federal Reserve's October policy meeting scheduled for next week, Dallas Federal Reserve President Richard Fisher said Monday in an interview with CNBC that he continues to support ending the bond-buying program this month despite recent stock market volatility.

Fisher's remarks were in contrast with a dovish stance from James Bullard, president of St. Louis Federal Reserve Bank, who said last Thursday that the central bank should think about delaying the end of its asset purchases program to halt a collapse in inflation expectations.

In late New York trading, the euro rose to 1.2807 dollars from 1.2775 dollars of the previous session. The dollar bought 106.83 Japanese yen, higher than 106.68 yen of the previous session.

Crude prices were stabilized Monday after the market rebounded briefly late last week.

Light, sweet crude for November moved down 4 cents to settle at 82.71 dollars a barrel on the New York Mercantile Exchange.

Gold futures on the COMEX division of the New York Mercantile Exchange rose on physical demand from Asia.

The most active gold contract for December delivery rose 5.7 dollars, or 0.46 percent, to settle at 1,244.7 dollars per ounce.