NEW YORK – Investors waiting for earnings reports to flow in traded cautiously Monday, giving up early gains and leaving the market narrowly mixed. The Dow Jones industrials reached a new 2009 trading high, edging closer to 10,000.
Volume was light because of the Columbus Day holiday. Bond markets were closed and there were no economic reports.
A weaker dollar and a spike in oil prices above $73 drove energy and materials prices higher, but weakness in technology and industrial shares held the market back. Stocks got an early boost from a better-than-expected profit report from Dutch company Royal Philips Electronics. That sent Britain’s leading stock indicator to its highest level in a year.
Investors looked ahead to the flurry of earnings due this week from key companies including Intel Corp., Johnson & Johnson, IBM Corp. and General Electric Co. Top U.S. banks, including JPMorgan Chase & Co., Goldman Sachs Group Inc., Citigroup Inc. and Bank of America Corp. will issue reports as well.
The Dow traded as high as 9,931, just 69 points away from 10,000, a level not seen in a year. The index rose for the third day in a row and has gained in five out of the last six sessions.
The Dow closed up 20.86, or 0.2 percent, at 9,885.80. The Standard & Poor’s 500 index rose 4.70, or 0.4 percent, to 1,076.19. Both indexes had their highest close in a year.
The Nasdaq composite index fell 0.14, or 0.01 percent, to 2,139.14.
Advancing stocks narrowly outpaced declining ones on the New York Stock Exchange, where consolidated volume was very low at 3.76 billion shares versus 3.85 billion on Friday.
Analysts said traders are generally optimistic about the upcoming third-quarter earnings reports, especially after aluminum maker Alcoa Inc. — the first of the 30 companies that make up the Dow to report earnings — said last week that it turned a profit for the first time in nine months.
"There is some key stuff coming and the market has anticipated that it’s going to be good," said John Wilson, chief technical strategist at Morgan Keegan.
The dollar mostly fell against other major currencies, helping to drive commodity prices higher. A weak dollar makes commodities more attractive to foreign investors. Gold rose $8.90 to $1,057.50 an ounce, while oil prices rose $1.50 to settle at $73.27 a barrel on the New York Mercantile Exchange.
The dollar has fallen steadily over the past few months as investors, more upbeat on the economy take money out of traditional safe-haven assets and put it to work in stocks. The ICE Futures U.S. dollar index, which tracks the dollar against other major currencies, is down about 14 percent since early March. The S&P 500 index is up 59 percent since then.
Better-than-expected first-quarter results from banks set off the stock market’s rally seven months ago, and even stronger second-quarter results helped fortify the rally in July.
Analysts say companies’ earnings reports will determine where the market heads next. If results exceed expectations and show companies are making money through sales and not just cost cutting, stocks could continue their push higher.
"There’s still room here for equities to move up on the back of better-than-expected results," said Craig Peckham, an analyst at Jefferies & Co. "I don’t think that positive surprises are fully priced in."
Banks were among the big gainers Monday as investors awaited their earnings. Wells Fargo & Co. rose $1.07, or 3.7 percent, to $30.28, while Citigroup Inc. was up 14 cents, or 3 percent, at $4.77.
In other trading, the Russell 2000 index of smaller companies fell 1.11 to 613.81.
Britain’s FTSE 100 rose 0.9 percent, Germany’s DAX index jumped 1.3 percent, and France’s CAC-40 gained 1.2 percent. In Asia, Hong Kong’s Hang Seng index finished down 0.9 percent. Japan’s market was closed for a holiday.
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