US stocks edged mostly higher on Monday as a rating upgrade on IBM helped ease the drag of Delphi Corp's bankruptcy filing on Dow component General Motors Corp and investor focus turned to the start of the quarterly earnings reporting season.
Shares of International Business Machines Corp, a Dow component, climbed 1.8 percent to $81.93 on the New York Stock Exchange after Citigroup upgraded its rating on IBM to "buy" from "hold."
Those gains helped offset a ratings downgrade of GM, which shed 5.4 percent to $26.76 after brokerage Banc of America cut its rating on the stock to "sell" from "neutral," citing possible risk from auto parts supplier Delphi.
Banc of America Securities also increased its estimate of the likelihood that GM itself would file for bankruptcy protection to 30 percent from the previous 10 percent.
The Dow Jones industrial average was up 18.27 points, or 0.18 percent, at 10,310.58. The Standard & Poor's 500 Index was down 1.35 points, or 0.11 percent, at 1,194.55. The technology-laced Nasdaq Composite Index was up 0.75 of a point, or 0.04 percent, at 2,091.10.
"It seems the confluence of events, with Delphi, and the week you had last week, you start out here pretty tepid. I am not putting much stock in what the earnings are, but I think investors are waiting to hear what the companies would say about the outlook," said Jon Brorson, managing director of growth equities at Neuberger Berman.
A sales warning from chip maker Xilinx Inc capped gains on technology shares.
"The market is just awaiting for the earnings season to begin," Brorson said. "October, for whatever the reason, always has a rough start. For some reason, the market has a problem with the month."
A drop in oil prices also pulled energy stocks lower. US crude futures for November delivery fell 79 cents to $61.05 a barrel.
Oil company Exxon Mobil Corp, a Dow component, fell 1.5 percent to $58.70 on the NYSE. Futures broker Refco Inc slid nearly 34 percent to $18.90 after the company said Chairman Philip Bennett had taken a leave of absence at its request. Refco said it had discovered a $430 million receivable owed to Refco by an entity controlled by Bennett.
Dow component Alcoa Inc, the world's largest aluminium producer, reports its results after Monday's closing bell, kicking off the third-quarter earnings reporting season.
Alcoa already has warned its results would fall short of Wall Street's expectations. Alcoa fell 0.5 percent to $22.94 on the NYSE.
Delphi, the No 1 US auto-parts supplier, filed for bankruptcy on Saturday, leading GM, which spun off Delphi in 1999, to warn of the possibility of costly supply disruptions.
Delphi shares fell 57.1 percent to 48 cents and the NYSE said it was reviewing the company's listing status.
Xilinx, which makes programmable microchips, cut its sales estimate for the September quarter, citing weakness in Asia-Pacific demand and other factors. Its stock fell 15.3 percent to $22.97 on Nasdaq.
Among other gainers in the Dow average were the shares of Wal-Mart Stores Inc, which rose 2.1 percent to $44.97 after a report in Barron's over the weekend quoted an analyst, who said the stock could rise as high as $63 in the next year.
Dana Corp, another auto parts maker, said it will restate earnings for 2004 and the first half of 2005 and delay posting third-quarter 2005 earnings, citing accounting problems. Its stock fell 30.7 percent to $6.37.
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