BLUE CHIP stocks ended with small gains yesterday as a jump in the shares of International Business Machines (IBM) provided most of the lustre to an otherwise dull market.

Advancing issues beat declines 1,297 to 978 on light volume of 296 million shares on the New York Stock Exchange.

IBM gained after Salomon Brothers said the shares of the world's biggest computer maker could reach a 12 month target of $145.

"The reality is when we have a thin market like the one we have, people are likely to crowd around the one or two ideas catching the Street's attention," said Mr Joseph Barthel, chief investment strategist at Fahnestock & Co.

Mr John Jones, an analyst at Salomon, said he upgraded IBM to strong buy from buy, citing rising near term confidence in the computer maker's fundamentals.