Stocks Close Nearly Flat Following Lackluster Session - U.S. Commentary

(RTTNews) - After turning in a mixed performance in the previous session, stocks continued to show a lack of direction during trading on Monday.

The major averages ended the day nearly flat. The Dow dipped 18.77 points or 0.1 percent to 18,142.42, the Nasdaq edged down 0.97 points or less than 0.1 percent to 5,189.13 and the S&P 500 slipped 0.26 points or less than 0.1 percent to 2,126.15.

Traders seemed reluctant to make more substantial moves ahead of several significant events scheduled for later this week.

The Federal Reserve is likely to be in the spotlight this week, with the central bank due to announce its latest monetary policy decision on Wednesday.

While the Fed is widely expected to remain on hold ahead of the impending elections, analysts have suggested the accompanying statement could further hint at the likelihood of a rate hike in December.

The monthly jobs data is also likely to attract attention along with reports on personal income and spending, manufacturing and service sector activity, and international trade.

Earnings news will also remain in focus, as Facebook (FB), Pfizer (PFE), Kellogg (K), Electronic Arts (EA) Time Warner (TWX), and Starbucks (SBUX) are among the companies due to report their quarterly results this week.

On the U.S. economic front, the Commerce Department released a report showing that personal income increased by slightly less than expected in the month of September, although personal spending rose in line with estimates.

The report said personal income climbed by 0.3 percent in September after edging up by 0.2 percent in August. Economists had expected income to rise by 0.4 percent.

Meanwhile, the Commerce Department said personal spending increased by 0.5 percent in September following a 0.1 percent dip in August. The increased in spending matched economist expectations.

A separate report from MNI Indicators showed an unexpected slowdown in the pace of growth in Chicago-area business activity in the month of October.

MNI Indicators said its Chicago business barometer dropped to 50.6 in October from 54.2 in September, although a reading above 50 does indicate growth. Economists had expected the index to inch up to 54.3.

Sector News

Gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 2.5 percent. The strength in the sector came despite a decrease by the price of gold.

Significant strength was also visible among utilities stocks, as reflected by the 2 percent jump by the Dow Jones Utilities Average.

Networking, commercial real estate and electronic storage stocks also saw considerable strength, while energy stocks came under pressure amid a steep drop by the price of crude oil.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index edged down by 0.1 percent, while Australia's All Ordinaries Index climbed by 0.6 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the German DAX Index dipped by 0.2 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index fell by 0.5 percent and 0.8 percent, respectively.

In the bond market, treasuries moved modestly higher after trending lower over the past few sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 1.834 percent.

Looking Ahead

The Institute for Supply Management is scheduled to release its report on manufacturing activity on Tuesday, but trading activity may remain light as the Fed announcement looms.