US stocks edged up on Monday with equities rebounding from early lows as oil prices retreated from worrisome levels and data showed continued improvement in the beaten-down US housing market. The S&P 500 has risen more than 8 percent this year. It has been stuck in a tight range between 1,355 and 1,370 as expectations for a period of consolidation are offset by a string of data pointing to a firmer recovery in the US economy, including in the key housing and labour markets.
Oil prices have also kept the S&P 500 index from further gains in recent weeks as worries over disruptions to Middle East supplies along with expectations for greater demand from an improving US economy pushed prices higher. But equities managed to rebound from initial lows as US crude futures dropped 1.1 percent to $108.56 a barrel after hitting a 10-month high on Friday.
"There is a degree of elasticity that we are kind of running up against here, it is becoming an issue for the market," said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey. "Now when people talk about energy, they are talking about the geopolitical, but that morphs into a concern about demand, and the demand conversation kind of undermines confidence."
The Dow Jones industrial average gained 21.64 points, or 0.17 percent, to 13,004.59. The Standard & Poor's 500 Index added 2.50 points, or 0.18 percent, to 1,368.24. The Nasdaq Composite Index gained 7.38 points, or 0.25 percent, to 2,971.13. Housing-related stocks moved higher after data showed contracts for home resales rose to a near two-year high in January, lending more credence to the argument that the industry may be in the beginning stages of a recovery.
The PHLX housing sector index climbed 1.1 percent, buoyed by a 3.2 percent advance in Owens Corning to $31.89. Lowe's Cos, the world's second-largest home improvement chain, reported higher-than-expected quarterly sales, and its shares rose 2 percent to $27.70.
Through Monday morning, of the 468 S&P 500 companies that have reported earnings for the most recent quarter 63 percent have beaten analyst expectations. More than 20 companies in the index are expected to report results this week. Biotech stocks fell after Dendreon Corp said demand was soft for its high-priced Provenge prostate cancer treatment as the year began, and forecast low-single-digit sales growth in the first quarter. Dendreon slumped 16.4 percent to $12.43. The NYSEArca biotech index lost 1.5 percent.
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