* S&P 500, Dow industrials at 5-yr highs; IBM gains on outlook
* Apple earnings disappoint after market closes
* Yen steadies after two-day gain against the dollar
* Gold slips as U.S. debt talks make progress
By Ellen Freilich
NEW YORK, Jan 23 U.S. and European stocks rose on Wednesday, propelled by strong earnings reports and the extension of the U.S. debt ceiling.
The advance in U.S. stocks put the broad S&P 500 stock index just 4.7 percent from its all-time closing high of 1,565.15. But the market could fall on Thursday after Apple earnings disappointed investors after the market closed.
The U.S. House of Representatives voted to extend the government's borrowing authority under the federal debt limit until May.
Technology shares were a focus, following strong results from IBM and Google on Tuesday. After the market closed, Apple Inc, the world's largest technology company, reported quarterly revenue that slightly missed Wall Street expectations as sales of its flagship iPhone came in below target. Its shares fell 6.5 percent in after-hours trading.
Shares of IBM, the world's largest technology services company, propelled the Dow Jones industrial index higher. IBM rose 4.4 percent after the company outlined a better-than-forecast outlook for 2013 and posted better-than-expected fourth-quarter earnings and revenue.
"Investors are encouraged by corporate earnings results as we've seen them so far," said Gregory Peterson, director of investment research at Waltham, Massachusetts-based Ballentine Partners LLC, with $3.5 billion in assets under management.
On Wall Street, the Dow Jones industrial average gained 67.12 points, or 0.49 percent, at 13,779.33. The Standard & Poor's 500 Index was up 2.25 points, or 0.15 percent, at 1,494.81. The Nasdaq Composite Index was up 10.49 points, or 0.33 percent, at 3,153.67.
The MSCI index of global markets was unchanged, but Europe's FTSEurofirst 300 index rose 0.19 percent, near a 22-month high. Germany's DAX, which is close to its 2008 high, was up 0.15 percent, and Britain's FTSE 100 index gained 0.3 percent.
Some of the money shifting into stocks came from Treasuries, whose low yields lack appeal for investors, said Brian Gendreau, market strategist at Gainesville, Fla.-based Cetera Financial Group, with $20 billion in assets under management.
Nevertheless, Treasuries eked out modest gains, with the benchmark 10-year note up 4/32 in price, pushing its yield down to 1.83 percent.
"There's still a tsunami of money coming into the Treasury market from foreign central banks and the Federal Reserve," Gendrau said.
In foreign exchange markets, the yen steadied against the dollar and euro, ending a gain made in reaction to a Bank of Japan monetary easing decision that fell short of expectations.
The yen is still down 11 percent from its mid-November levels, when investors began to price in prospective monetary accommodation from the Bank of Japan.
The BoJ this week lifted its inflation target to 2 percent and promised to buy assets. But the starting date for the purchases, not before 2014, disappointed investors who had expected the central bank to act with greater urgency.
The dollar was steady at 88.70 yen, off a 2-1/2-year high of 90.25 yen on Monday.
The euro was also little changed against the dollar at $1.3316.
Investors' improved view of the euro zone was evident in a comeback for Portugal's bond market. Portugal's first bond sale since its 2011 rescue drew strong demand, bolstering hopes the country can make a full market return that would allow it to call on further European Central Bank support.
A 10-year bond sale by Spain on Tuesday was swamped by demand from foreign investors.
Gold fell further from this week's one-month high after a report showing a rise in euro zone consumer confidence capped investors' interest in the metal.
Spot gold stood at $1,684.86 an ounce. Traders said progress in talks about the U.S. debt limit reduced gold's appeal as a safe haven, offsetting the influence of this week's monetary easing promise from the Bank of Japan.
U.S. crude prices dropped sharply on news a key oil pipeline had restricted throughput, leading to expectations that supply would swell at the Midwest delivery point for the contract.
International Brent crude prices held positive, but U.S. crude plunged after shippers got notice that the newly expanded 400,000 barrel per day Seaway pipeline had cut rates to 175,000 barrels per day.
The line ships crude from the Cushing, Oklahoma, delivery point for the New York Mercantile Exchange's oil contract to the U.S. Gulf Coast, and the reduction was expected to increase already ample inventories at the hub.
U.S. crude oil futures settled down $1.45 to $95.23 a barrel, while Brent crude oil prices traded up 48 cents to $112.90 a barrel.
Copper was barely changed despite higher output reported by mining groups such as BHP Billiton. Three-month copper on the London Metal Exchange was down 0.45 percent at $8,103,15 a tonne .
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