By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks finished little changed on
Monday, with the S&P 500 adding a fraction to its record close
and the Nasdaq Composite extending gains into a fourth session,
bolstered by Netflix Inc., which released earnings just after the
close.
Netflix (NFLX) shares ended Monday's regular trading session
6.4% higher, then surged nearly 17% in after-hours trade after the
provider of streaming video reported third-quarter revenue that
beat estimates.
The Dow Jones Industrial Average (DJI) fell 7.45 points, or less
than 0.1%, to 15,392.20.
McDonald's Corp. (MCD) fell 0.6% after the fast-food chain
reported sales below expectations. Another Dow component, AT&T
Inc., (T) climbed 1.8% after the telecommunication company agreed
to sell or lease 9,700 wireless towers.
J.P. Morgan Chase & Co. (JPM) lost almost 0.1% after the
bank reportedly agreed to pay $13 billion to halt U.S. civil
investigations into its mortgage-bond sales.
After rising to an intraday record high of 1,747.79, the S&P
500 index (SPX) rose a fraction to finish at 1,744.66, just topping
its prior record close of 1,744.50 set on Friday. Health care lost
the most ground and telecommunications fared the best among its 10
sectors.
J.C. Penney Co. (JCP) shares dropped 8.3% after the retailer
last week denied two anonymous social-media attacks that said the
company had retained a bankruptcy lawyer and had lost access to
credit in Canada.
Gannett Co. Inc. (GCI) shares lost 2.2% after the newspaper
chain reported a 4% decline in quarterly revenue. Hasbro Inc. (HAS)
gained 5.3% after the toy seller reported third-quarter results
that beat Wall Street's expectations.
The Nasdaq Composite (RIXF) rose 5.77 points, or 0.2%, to
3,920.05.
"This has been a year of significant multiple expansion," said
Paul Karos, a senior portfolio manager for Whitebox Mutual Funds,
of the price-earnings ratio of U.S. equities. But since that
expansion has not coincided with a broad-based earnings revision
upward, "it would not be surprising to see equity markets take a
breather," given the market's more than 20% rise so far this year,
he said.
"We can continue to grind higher, but it's a grind, the next
sustainable leg would probably need to come from upwardly revised
earnings estimates, that could be hard to come by," Karos
added.
Decliners just overcame advancers on the New York Stock
Exchange, where 678 million shares traded. Composite volume cleared
3 billion shares.
On Tuesday, the government releases the nonfarm-payrolls report
for September. The data release was among those delayed by the
recently ended 16-day government shutdown.
Equities displayed muted reaction to the National Association of
Realtors reporting existing U.S. home sales fell 1.9% in September
due to rising prices and mortgage rates.
Gold futures (GCZ3) rose $1.20 or 0.1%, to $1,315.80 an ounce,
and crude futures (CLX3) lost $1.59, or 1.6%, to $99.22 a barrel on
the New York Mercantile Exchange.
The dollar(DXY) gained against the currencies of major U.S.
trading partners, including the euro (EURUSD) and the yen
(USDJPY).
The yield on the 10-year Treasury note (10_YEAR) used in
figuring mortgage rates and other consumer loans rose 2 basis
points to 2.603%.
"Both the economy and earnings appeared to have had good
momentum going into the fourth quarter. However, analysts will
still need to assess how much the (government) shutdown hurt the
economy," noted David Kelly, chief global strategist at J.P. Morgan
Funds, in emailed commentary.
The global economy is "still on the mend in the face of the
easiest monetary policy ever implemented by developed-nation
central banks. As the economy improves and earnings rise, this aid
will gradually be reduced, boosting interest rates. Despite recent
stock-market gains, such an environment still supports the idea of
an overweight to equities relative to fixed income around the
world," wrote J.P. Morgan Funds' Kelly.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires