Dow, S&P Flat, Nasdaq Slips Waiting For Fed
NEW YORK (Reuters) - The Dow and S&P 500 were little changed on Monday while the Nasdaq slipped, as investors took profits mostly in the technology sector ahead of possible policy action from the Federal Reserve later in the week.
The benchmark S&P 500 index rose 2.2 percent last week to hit highs not seen in nearly five years, and traders were eyeing the 1,440 level on the S&P as the next barrier to further gains.
Whether the S&P gets there could depend largely on the Federal Reserve, which may say on Thursday whether it will engage in more bond-buying to keep interest rates low. Previous efforts at stimulating the economy have bolstered buying in stocks.
"There is a huge potential for a tremendous rally," said Dave Rovelli, managing director of U.S. equity trading at Canaccord Adams Inc. "And if we get to 1,440, that's what everybody is looking for. Everybody is looking at whether (Fed Chairman Ben) Bernanke institutes QE3."
Expectations for more stimulus measures from the U.S. Federal Reserve and the European Central Bank have underpinned the markets in recent weeks. Friday's disappointing U.S. jobs data further boosted those expectations.
Investors are also awaiting a ruling on Wednesday by Germany's constitutional court on the legality of the euro zone's permanent financial rescue fund, which could derail plans by the European Central Bank for substantial buying of short-term debt.
After the Nasdaq hit a 12-year high last week, investors did some selling of big-cap tech names that have done well all year. Worse-than-expected data on imports from China was a factor in the selling in that sector.
"Today there is a little pull back, a little profit-taking in technology after last week," said Gary Wedbush, head of trading at regional investment bank Wedbush Morgan in Los Angeles. "I would use it as a buying opportunity."
The Dow Jones industrial average <.dji> was up 2.79 points, or 0.02 percent, at 13,309.43. The Standard & Poor's 500 Index <.spx> was down 1.46 points, or 0.10 percent, at 1,436.46. The Nasdaq Composite Index <.ixic> was down 14.04 points, or 0.45 percent, at 3,122.39.
American International Group Inc
Chinese import data showed a fall of 2.6 percent on the year in August, short of expectations for a 3.5 percent rise. Exports grew 2.7 percent, below forecasts for a 3 percent rise in a Reuters poll.
The data increased the odds of more Beijing-backed spending to deal with the damage done to the domestic economy by firms cutting production, inventories and imports due to weak global demand.
Plains Exploration & Production Co
Titan Machinery Inc
(Editing by Dave Zimmerman)
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