U.S. stocks shed Monday losses to end modestly higher as investors again viewed a market drop as a buying opportunity.
“The declines are shallow as buyers come in because they need additional equity exposure. The path of least resistance is up,” said Marc Chaikin, CEO of Chaikin Analytics.
The S&P 500 index gained 9.79 points, or 0.6%, at 1,563.07, with consumer-related companies pacing the gains that included all but one of its 10 major sectors.
After rising to a record closing high of 1,570.25 a week ago, the S&P 500 index declined 1% last week following the smallest increase in jobs in nine months and other reports on manufacturing and services also came in below expectations.
The jobs report prompted worries the U.S. economy had hit a soft patch. Breaking down the jobs report
Still, the S&P 500 remains 9.6% higher for the year, with corporate profit and the Federal Reserve’s ongoing bond-buying program helping support equities.
“There are so many skeptics about the market going to new highs; pullbacks like last week are frustrating the bears, since there is no downside follow through,” said Chaikin.
After a 67-point fall during the day, the Dow Jones Industrial Average ended at 14,613.48, up 48.23 points, or 0.3%.
Twenty-one of its 30 components finished in positive terrain, led by Bank of America Corp., Coca-Cola Co. and Walt Disney Co. .
Pharmaceutical giant Johnson & Johnson led blue-chip decliners, off 1.1% following a downgrade to neutral from overweight at J.P. Morgan.
After the close, Alcoa Inc. became the first member of the Dow Jones Industrial Average to release results for the first quarter when the aluminum producer reports its results.
While Alcoa’s results mark the unofficial start of the earnings season, analysts cautioned against reading too much into its report.
“Do not get caught up in the hype of Alcoa being a good proxy for the upcoming earnings season because it is not and certainly its stock price has not reflected it either,” said Nick Raich, chief executive officer at The Earnings Scout.
The Nasdaq Composite added 18.39 points, or 0.6%, to 3,222.25.
Among movers, Advanced Micro Devices rallied 13%, leading S&P 500 gainers. Read more in Monday’s movers.
Lufkin Industries Inc. rallied 38% after the General Electric Co. said it would acquire the manufacturer of oil-well pumps for about $3.3 billion, or $88.50 a share.
BioCryst Pharmaceuticals Inc. shares leapt 13% to $1.92 after reports China had sped up the approval of its anti-influenza drug Peramivir.
For every stock on the decline more than two gained on the New York Stock Exchange, were nearly 583 million shares traded.
Composite volume surpassed 2.8 billion.
Federal Reserve Chairman Ben Bernanke is scheduled to give a speech after Monday’s close, with investors looking for any clues as to how long the central bank would continue its monetary easing.
“It’s still a bad-news, good-news market where modestly poor economic data keeps the Fed engaged,” said Paul Nolte, managing director at Dearborn Partners in Chicago.
“We’re still within a few percentage points of all-time highs. Along the lines of Mark Twain, I think the death of this market has been greatly exaggerated,” Nolte said. “A little bit of a pullback is not a bad thing and has been expected for a while.”
Oil prices rebounding from last week’s loss of nearly 5%, while the U.S. dollar gained against other currencies including the yen . Treasury prices were mixed, with the yield on the 10-year note at 1.743%.
The biggest earnings of the week will come from J.P. Morgan Chase & Co. and Wells Fargo & Co. , which both report on Friday. . Read: Earnings are first big stock test since market high
Marketwatch
