Major stock indexes closed mixed Monday. Bullish sentiment toward earnings and economic growth was offset by concerns of higher interest rates following a rise in Treasury yields and a jump in oil prices, according to Standard & Poor's Marketscope. Strength in IT and biotech names boosted the Nasdaq, while losses in Home Depot (HD), Honeywell (HON) and United Technology (UTX) weighed on the Dow.
The Dow Jones industrial average fell 17.76 points, or 0.17%, to 10,623.15. The broader Standard & Poor's 500 index gained 1.17 points, or 0.09%, to 1,235.35. The tech-heavy Nasdaq composite gained 10.55 points, or 0.48%, to 2,195.38.
Looking ahead to Tuesday, figures on June personal income and consumer spending will be released, along with data on June factory orders. Economists expect personal income to rise by 0.4%, after rising by 0.2% in May, and consumer spending to rise by 0.8%, after remaining flat in May, according to economists polled by Action Economics. June factory orders are seen rising by 1.1%, after increasing by 3.4% in May.
Among the companies reporting earnings on Tuesday are conglomerate Tyco International (TYC) and cable company Comcast (CMCSA).
Oil prices settled up $1.00 to $61.57 per barrel Monday. Action Economics said that traders were attributing the increase mainly to concerns over distillate supplies following last week's fires at refineries in Texas and Louisiana. Also supporting prices was the news that Saudi Arabia's ruler King Fahd died, and his brother Crown Prince Abdullah has been named to succeed him.
The July manufacturing index from the Institute of Supply Management climbed to 56.6 in July, up from 53.8 in June. The figure was stronger than the 54.9 reading economists were expecting.
June construction spending fell 0.3%, following a decline of 1.7% in May (which was revised downward from the first report of a 0.9% decline). The number was weaker than the 0.5% rise economists were expecting, but was unlikely to offset the strong ISM data, according to Action Economics.
In corporate news, mobile phone giant Nokia (NOK) said its longtime chief executive Jorma Ollila, will retire in June. His replacement will be Olli-Pekka Kallasvuo, head of the company's mobile phone unit, the company said.
Shares of auction website eBay (EBAY) gained 5% after Citigroup's Smith Barney upgraded its rating on the company to buy from hold.
In earnings news, Procter & Gamble Procter & Gamble (PG) fell 1.5% despite saying Monday that its fourth-quarter profit rose 9% to $1.5 billion, or 56 cents a share, which was a penny higher than expected.
Health insurer Humana (HUM) posted a quarterly profit increase of 4% to $84.1 million, which was in-line with analysts' expectations.
Wal-Mart (WMT) was slightly higher after saying over the weekend that July same-store sales growth is expected to come in at 4.4% from a year ago, which is at the high end of the company's estimates.
Treasury prices fell further Monday, following the release of the strong July ISM data, on speculation that the Federal Reserve will continue to raise interest rates for longer than has been expected. The yield on the benchmark 10-year note rose to 4.32%.
European stock markets closed higher Monday. London's FTSE 100 index ended up 8.50 points, or 0.13%, to 5,290.80, as the British July manufacturing purchasing managers' index fell to 49.2 from 49.6, sparking talk that the Bank of England will lower rates Thursday. Gainers included Shell, on higher oil prices.
Germany's DAX index added 4.35 points, or 0.09%, to 4,890.85 on a report that the Eurozone's July manufacturing purchasing managers' index rose to 50.8 from 49.9, which was better than expected. DaimlerChrysler was among those trading higher, after Goldman Sachs raised their estimate for the carmaker's earnings by 10%.
In Paris, the CAC 40 index gained 4.35 points, or 0.09%, to 4,890.85. Defense electronics group Thales was higher after the government said that it might sell its stake in the company.
Asian markets finished higher Monday. In Japan, the Nikkei index closed up 47.32 points, or 0.40%, at 11,946.92 following strong quarterly earnings from key names, including mobile telecommunications provider NTT DoCoMo and construction group Komatsu.
In Hong Kong, the Hang Seng index gained 97.90 points, or 0.66%, moving to 14,978.88, led by the bank HSBC ahead of its first half earnings release after the close.