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US: Microsoft lifts Dow, S&P to records, before oil limits gains

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[NEW YORK] The Dow and the S&P 500 were little changed on Wednesday, easing after hitting fresh intraday records, as the boost to tech stocks from Microsoft's results was curbed by a drop in energy stock as oil prices fell.

Microsoft was up 4.9 per cent at US$55.72, making it the biggest boost to the three major indexes, after its results handily beat expectations.

The technology index rose 1.05 per cent, leading the three gainers among the 10 major S&P sectors. But, the energy index was down 1.07 per cent as oil prices fell 1.5 per cent.

Crude oil futures hit 2-month lows on technical selling pressure and liquidation by investors fearing a supply glut despite impending government data likely to show a drawdown.

With the stock market on a record-setting rally, investors have been keeping a sharp eye on corporate earnings to see if they can help sustain the momentum.

"For the rally to sustain we are going to need to see continued improvement in the earnings and economic activity," said Peter Cardillo, chief market economist at First Standard Financial in New York.

Mr Cardillo said investors should be prudent at current stock levels, given the uncertainty following Britain's vote to leave the European Union and other ongoing geopolitical concerns.

At 9:46 am ET (1346 GMT) the Dow Jones Industrial Average was up 1.16 points, or 0.01 per cent, at 18,560.17.

The S&P 500 was up 1.73 points, or 0.08 per cent, at 2,165.51.

The Nasdaq Composite was up 21.88 points, or 0.43 per cent, at 5,058.25.

Morgan Stanley was up 1.8 per cent at $28.70 after its profit topped analysts' estimates, rounding off upbeat results from the six biggest Wall Street banks.

Disney fell 2 per cent to US$97.47 after a Stifel rating downgrade. The stock was the biggest drag on the S&P and the Dow.

Intuitive Surgical was up 6 per cent at US$713.41 after the medical device maker's profit beat estimates.

Intel, eBay and American Express are scheduled to report results after the bell.

Declining issues outnumbered advancing ones on the NYSE by 1,489 to 1,122. On the Nasdaq, 1,195 issues rose and 1,073 fell.

The S&P 500 index showed 24 new 52-week highs and no new lows, while the Nasdaq recorded 35 new highs and seven new lows.