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Stocks move higher ahead of earnings

Stocks move higher ahead of earnings

Stocks are extending recent gains at the start of a busy week of earnings, nudging the Dow Jones industrial average closer to 10,000.
Major market indicators rose moderately early Monday, including the Dow, which rose as much as 62 points to hit a new 2009 high of 9,926. That's just 74 points shy of 10,000, a level not seen in a year.
Stocks got an early boost from a better-than-expected profit report from Dutch company Royal Philips Electronics. A weaker dollar drove oil and other commodities higher, giving energy, material and industrial stocks a lift.
Trading on Monday is expected to be fairly light as much of the country observes the Columbus Day holiday. No major economic reports are scheduled and government bond markets are closed.
A flurry of earnings reports, including ones from the largest U.S. banks, will occupy the market's attention the rest of this week. JPMorgan Chase & Co. reports on Wednesday, followed by Goldman Sachs Group Inc., Citigroup Inc. and Bank of America Corp. A number of major technology firms, including Intel Corp., Google Inc. and International Business Machines, will also report results this week.
At banks, investors are hoping to see signs that consumer loan defaults, including mortgages, are starting to level off, and will be looking for any potential trouble with commercial real estate loans. Overall, the market wants to see evidence that an economic recovery is under way.
Earnings season got off to a good start last week when aluminum maker Alcoa Inc. reported a surprise profit. That helped lift the Dow to its highest level in a year, giving the index a 4 percent gain for the week, its best weekly performance since July. The Dow now stands less than 100 points away from the 10,000 mark, a level it has not seen since October 2008.
In early trading, the Dow rose 58.80, or 0.6 percent, to 9,923.74. The Nasdaq composite index rose 16.12, or 0.8 percent, to 2,155.40.
More than two stocks rose for every one that fell on the New York Stock Exchange, where volume came to a light 104.2 million shares, compared with 122.5 million at the same time on Friday.
The dollar mostly fell against other major currencies, helping to drive commodity prices higher. A weak dollar makes commodities more attractive to foreign investors. Gold was up about $6 at $1,054 an ounce, while oil prices added $1.79 to $73.56 a barrel on the New York Mercantile Exchange.
The dollar has fallen steadily over the past few months, as investors, more upbeat on the economy, take money out of traditional safe-haven assets and put it to work in stocks. The ICE Futures U.S. dollar index, which tracks the dollar against other major currencies, is down 14 percent since early March. The S&P 500 index is up 58.4 percent since then.
Better-than-expected first-quarter results from banks set off the stock market's rally seven months ago, and even stronger second-quarter results helped fortify the rally in July.
Analysts say companies' earnings reports will determine where the market heads next. If results exceed expectations and show companies are making money through sales and not just cost cutting, stocks could continue their push higher.
"There's still room here for equities to move up on the back of better-than-expected results," said Craig Peckham, an analyst at Jefferies & Co. "I don't think that positive surprises are fully priced in."
But disappointing earnings could easily upset investors who are looking for reassurance that the economy is growing and lead them to sell stocks.
In other trading Monday, the Russell 2000 index of smaller companies rose 0.86, or 0.1 percent, to 615.78.