By Victor Reklaitis, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks mostly tacked on modest
gains Monday after an industrial-production reading beat
expectations but a pending-home-sales gauge missed forecasts.
Investors also are focused on after-the-bell results from Apple
Inc. and a Federal Reserve meeting later this week.
The S&P 500 (SPX) was last up 3 points, or 0.2%, to 1,763.
Consumer staples and health care fared best among S&P 500
sectors, while utilities and materials performed worst. The
benchmark is on track for another record close, topping Friday's
all-time high.
The Dow Jones Industrial Average (DJI) rose 20 points, or 0.1%,
to 15,590. Procter & Gamble Co.(PG) and Coca-Cola Co.(KO) led
among blue chips, while Merck & Co.(MRK) and United
Technologies Corp.(UTX) were laggards.
The Nasdaq Composite(RIXF) edged down less than 1 point, or less
than 0.1%, to 3,943. The tech-heavy index got a slight boost from
Apple (AAPL) , which rose 0.4%.
Bruce Bittles, chief investment strategist at Robert. W. Baird
& Co., said stocks have been supported somewhat by
better-than-expected third-quarter earnings, but the primary driver
is still the Federal Reserve's bond-buying program that he
predicted "is going to be with us at least through March."
"I think temporarily the economic data is going to be
irrelevant," Bittles told MarketWatch on Monday, noting the U.S.
government shutdown has led to many delayed economic reports. Such
issues with the economic data, along with a weak September jobs
report, will contribute to the Fed deciding to stay the course with
its bond buys during its two-day meeting that ends Wednesday,
Bittles added. That fits with the overwhelming consensus among Fed
watchers.
"I don't expect anything of substance or any market-moving
rhetoric to come out of the Fed," Bittles said. He also pointed out
that Fed Chairman Ben Bernanke is near the end of his term and
therefore unlikely to "rock the boat."
In addition, the investment strategist sees seasonal patterns
helping stocks. Historically, stocks in general have performed well
in November and December and rarely have reversed to the downside
during those two months, according to a Baird research note out
Monday.
"The seasonal patters or cyclicals are certainly in favor of a
continuation of this rally into January," Bittles said.
Meanwhile, analysts at Monex Capital said they see plenty of
market drivers in the coming week.
"Optimism over corporate earnings and the fact that there's no
end in sight to the lax monetary policy of the Fed have combined to
leave equity traders on the front foot as the new week gets under
way," the analysts said in a note.
"With a hectic week of economic and corporate data from the U.S.
on the cards, there's going to be no shortage of drivers to provide
some meaningful direction," they added.
Apple's fiscal fourth-quarter report, expected after the
market's close, is forecast to show a profit decline. Analysts
surveyed by FactSet forecast the company to report earnings of
$7.92 a share, down 9% from the same period a year earlier, on
revenue of $36.87 billion.
Investors also will zero in on what's ahead for Apple, whose
stocks has gained about 25% since its last quarterly report.
"We believe the core focus will be on December guidance, since
Apple already reiterated the high end of its guidance for September
($34-$37 billion in revenue) following the iPhone 5S launch," said
Gene Munster at Piper Jaffray.
Other notable companies reporting earnings on Monday include
Merck, Seagate Technology PLC (STX) and Burger King Worldwide
Inc.(BKW)
Before the open, Merck posted a drop in third-quarter profit and
revenue. The stock traded 2.5% lower.
After the market's close, Seagate is expected to post earnings
of $1.31 a share in the first quarter. The stock was down less than
0.1% on Monday.
Burger King jumped nearly 6% after the fast-food chain posted
significantly fewer operating expenses and as same-store sales
increased in its international regions.
Among other movers, Bristol-Myers Squibb Co.(BMY) rose 6% after
the drug maker over the weekend reported "encouraging" Phase 1
results in its trial for lung-cancer drug nivolumab. Morgan Stanley
upped its view on the stock to overweight and said the company "is
the leading contender to transform cancer treatment with new drugs
that boost the immune system." J.P. Morgan reiterated its
overweight rating.
Loews Corp. (L) slipped 0.6% after the company said
third-quarter earnings rose 59%, as its CNA Financial Corp. (CNA)
insurance unit increased its revenue from insurance premiums.
In buyout news, Mosaic Co.(MOS) agreed to buy the Florida
phosphate business of fellow fertilizer company CF Industries
Holdings Inc.(CF) for $1.4 billion in cash. Mosaic was up 1.3%,
while CF jumped nearly 5%.
In economic news, the latest headline number for industrial
production beat expectations, but economists were disappointed with
the details of the report. A pending-home-sales gauge missed
forecasts, touching its lowest level in nine months.
There were no Fed speakers on tap as the central bank prepares
for its policy-setting meeting on Tuesday and Wednesday.
In other financial markets, gold and crude-oil prices were up
slightly, while the dollar (DXY) inched higher. Most Asia markets
closed higher, but European indexes pulled lower.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires