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Morgan Stanley ( MS ) rises as Q3 profit jumps

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Intel ( INTC ) slips after China cyber body recommends review

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Indexes: Dow up 0.31%, S&P 500 off 0.08%, Nasdaq down

0.39%

(Updated at 09:51 a.m. ET/1351 GMT)

By Lisa Pauline Mattackal and Purvi Agarwal

Oct 16 (Reuters) -

The Dow regained some lost ground on Wednesday although the

S&P 500 and the Nasdaq stumbled, dragged lower by declines in

megacap technology stocks, while the broader market gained from

upbeat quarterly earnings from banks, notably Morgan Stanley ( MS ).

Morgan Stanley ( MS ) rose 6.7%, joining peers such as

JPMorgan Chase ( JPM ) in reporting strong profits after a sharp

increase in investment banking revenue.

First Horizon ( FHN ) gained 3.3% and U.S. Bancorp ( USB )

rose 5% after reporting third-quarter results.

The Financials sector trended 0.7% higher, while

the broader Banks index was up 1.1%. An index tracking

regional banks rose 1.3%.

Gains on the benchmark index were kept in check by

Communication Services, which fell 0.7%, weighed by

Meta Platforms ( META ), which lost 1.5%.

Among other megacap stocks, Apple ( AAPL ) fell 1.4%

after hitting a record high in the previous session, while

Microsoft ( MSFT ) was off 1.3%.

The Dow Jones Industrial Average rose 133.14

points, or 0.31%, to 42,872.78, the S&P 500 lost 5.00

points, or 0.08%, to 5,810.69, and the Nasdaq Composite

lost 71.98 points, or 0.39%, to 18,243.21.

The small-cap Russell 2000 index outperformed

with a 0.83% gain.

"There has been a broadening out in terms of

participation... in the small caps versus the large caps. That's

a positive sign, some of it having to do with interest rates

coming down and some relief on the balance sheet side for more

highly levered smaller-cap companies," said Zachary Hill, head

of portfolio management at Horizon Investments.

Most semiconductor companies traded higher, with

heavyweight Nvidia ( NVDA ) up 0.5% after slumping nearly 5% in

the previous session.

However, U.S.-listed shares of chip equipment-maker ASML

Holding lost 5.3% after the company cut its

2025 financial forecast on Tuesday. Intel ( INTC ) fell 3.3%

after the Cybersecurity Association of China recommended

initiating a review of the chipmaker's products sold in the

country.

Declines in semiconductor and oil stocks dragged on Wall

Street on Tuesday, as investors were assessing a mixed-bag of

earnings. Still, the S&P 500 and the Dow were trading around

record high levels.

"Generally speaking, bank earnings have been pretty well

received by the market and that has been helpful for broad

indices... you definitely need things other than tech to be

working in order for that to continue," Hill said.

More corporate earnings are due through the week, along

with key economic data including the retail sales and industrial

production figures on Thursday, all of which are expected to

shed light on consumer health and the growth outlook for the

world's largest economy.

Bets on a 25-basis-point rate cut at the central bank's

November meeting have risen above 90%, according to CME's

FedWatch.

United Airlines rose 8% after it forecast

better-than-expected fourth-quarter profit and announced a

$1.5-billion share buyback program on Tuesday.

J.B. Hunt climbed 6.2% after

beating third-quarter profit

estimates on Tuesday after the bell.

Advancing issues outnumbered decliners by a 3.37-to-1

ratio on the NYSE, and by a 2.14-to-1 ratio on the Nasdaq.

The S&P 500 posted 25 new 52-week highs and no new lows,

while the Nasdaq Composite recorded 55 new highs and 20 new

lows.