US stocks edge higher as investors wait for earnings

In this Monday, Aug. 24, 2015, photo, pedestrians walk past the New York Stock Exchange. Global stock markets were mixed Monday, Oct. 12, 2015, following Wall Street's gains as investors looked ahead to the week's Chinese trade data. (AP Photo/Seth Wenig)
In this Monday, Aug. 24, 2015, photo, pedestrians walk past the New York Stock Exchange. Global stock markets were mixed Monday, Oct. 12, 2015, following Wall Street's gains as investors looked ahead to the week's Chinese trade data. (AP Photo/Seth Wenig)

NEW YORK (AP) — U.S. stocks edged higher Monday on a quiet day for the market ahead of a busy weak for corporate earnings.

EMC climbed after Dell said it would acquire the data storage company for $67 billion. Energy stocks slumped as the price of oil fell sharply following a report that showed OPEC members are keeping up production even after a big drop in prices over the last year.

Investors will be focusing on corporate earnings this week as they try to assess the impact that slowing global growth is having on company profits. Analysts are projecting that earnings contracted more than 5 percent in the third quarter as overseas demand weakened. JPMorgan Chase, Intel and Johnson & Johnson are among companies that will publish their earnings in coming days.

While the stock market was open Monday, bond trading was closed in observance of the Columbus Day holiday.

“The market is trading in a holiday mode,” said Peter Cardillo, chief market economist at Rockwell Global Capital. “We could see some hefty gyrations as earnings season moves into full gear.”

The Standard & Poor’s 500 index rose 2.57 points, or 0.1 percent, to 2,017.46. The Dow Jones industrial average rose 47.37 points, or 0.3 percent, to 17,131.86. The Nasdaq composite climbed 8.17 points, or 0.2 percent, to 4,838.64.

Energy stocks dropped the most among the 10 industry sectors of the S&P 500 as the price of crude fell sharply.

Oil dropped as a report showed that OPEC members are keeping up production even after a big drop in prices. Benchmark U.S. crude fell $2.53 to close at $47.10 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, fell $2.79 to $49.86 a barrel in London.

The slide in crude prices since last year is having a big impact on corporate earnings.

Overall, earnings are forecast to slide by 5.3 percent, compared with the same period last year, but much of that decline is due to a big slump in energy company profits. Earnings in the energy sector are forecast to slide by 66 percent, according to S&P Capital IQ.

Still, some analysts are confident that the outlook for companies will improve next year, as demand revives overseas and improving consumer confidence boosts the U.S. economy.

“This earnings season will be a confirmation process. ‘Yes, we have low inflation and yes, we are growing very moderately, but fairly dependably,’ ” said Scott Wren, senior global equity strategist at Wells Fargo Investment Institute. “It will be OK, it won’t be great, but I think we can look forward to better earnings growth in 2016.”

Gains were also muted as the stock market was coming off its biggest week of the year.

Most of the advance came after a disappointing jobs report which suggested the Federal Reserve could postpone a long-anticipated interest rate rise for several months. That thought was reinforced Thursday, when the minutes from the September Fed meeting showed policymakers were too concerned about low inflation and the slowdown in China to raise interest rates.

Low rates can help boost stocks by reducing returns on fixed-income investments such as bonds. They also make it easier for companies to borrow in the bond markets, giving them funds to buy back their own stock.

On Monday, Eli Lilly was among the day’s biggest losers.

The stock dropped after the drugmaker said it was halting development of evacetrapib, a drug that was intended to treat patients with high-risk heart disease. The stock fell $6.70, or 7.1 percent, to $79.44.

Data storage company EMC was a winner.

The stock climbed 51 cents, or 1.8 percent, to $28.37 after Dell said it was acquiring the company in a deal valued at about $67 billion. Since going private in 2013, Dell has been investing in research and development and expanding its software and services business.

In metal trading, gold closed up $8.60 at $1,164.50 an ounce. Silver rose 4.6 cents to $15.86 an ounce and copper was little changed at $2.42 per pound.

The dollar declined to 120.02 yen. The euro rose to $1.1364.

In other futures trading on the NYMEX:

— Wholesale gasoline fell 7.6 cents to close at $1.341 a gallon.

— Heating oil fell 8.9 cents to close at $1.502 a gallon.

— Natural gas rose 3.3 cents to close at $2.535 per 1,000 cubic feet.

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