US STOCKS-Dow, S&P advance before Alcoa opens earnings season
* Alcoa rises before reporting earnings after market's close
* Tech shares weigh on Nasdaq; Intel at 2 1/2 month low
* Goldman Sachs sees S&P 500 rising to 1,750 at year-end
* Dow up 0.5 pct, S&P 500 up 0.4 pct, Nasdaq flat
By Alison Griswold
NEW YORK, July 8 (Reuters) - U.S. stocks mostly rose on Monday, extending gains after last week's robust June payrolls report to push the S&P 500 closer to its all-time high set in May, just before the start of earnings season.
Eight of the 10 S&P 500 industry sector indexes rose, led by gains in energy, utilities and consumer staples. Consol Energy was among the S&P 500's best performers, up 3.7 percent at $27.48.
Technology shares fell, weighing on the Nasdaq Composite Index. Intel Corp was the S&P 500's worst performer, sliding 3.9 percent to $23.12 after analysts at Evercore Partners downgraded the company's stock to "underweight" from "equal weight." The drop took the stock down to its lowest level since late April.
On Monday, the benchmark S&P 500 was about 2 percent below its May 21 all-time closing high of 1,669.16. In June, the benchmark index fell as much as 5.8 percent below that record.
The gains have reassured investors, who worried that a strong jobs report could trigger a negative reaction from the market.
Strong economic data increases the likelihood the Federal Reserve will start to reduce its $85-billion-per-month in monetary stimulus in the near future. A Reuters poll of firms that deal directly with the Fed now see the reduction beginning in September.
"The fear of the quantative easing coming to an end, I think that's dissipated a little bit, so people are now really weighing that against the economic data," said Paul Brigandi, senior vice president of trading at Direxion Funds in New York.
"For the moment, the better-than-expected jobs report is outweighing the fear that the asset purchases could come to an end."
Interest rates have jumped sharply, with the yield on the 10-year U.S. Treasury note touching 2.7 percent. Higher rates make borrowing more expensive and stocks less attractive in terms of valuation.
The Dow Jones Industrial Average was up 70.24 points, or 0.46 percent, at 15,206.08. The Standard & Poor's 500 Index was up 6.91 points, or 0.42 percent, at 1,638.80. The Nasdaq Composite Index was down just 0.15 of a point, or unchanged on a percentage basis, at 3,479.23.
Dow component Alcoa Inc, the largest U.S. aluminum producer, unofficially begins the earnings season after the market's close. The company is expected to report earnings of 6 cents per share on revenue of $5.83 billion. Alcoa shares rose 0.6 percent to $7.86.
Goldman Sachs analyst David Kostin said in a note sent Sunday night to clients that rising earnings, coupled with stable margins, should lift the S&P 500 by 8 percent to Goldman's year-end target of 1,750. The index ended at 1,631.89 on Friday.
Analysts expect S&P 500 companies' earnings to rise 2.9 percent in the second quarter from a year ago, while quarterly revenue is forecast to increase 1.5 percent from a year ago, according to Thomson Reuters data.
Dell Inc shot up 2.9 percent to $13.40 after investment advisory firm ISS recommended shareholders vote for Chief Executive Michael Dell's $24.4 billion buyout offer.
In the biotech sector, Cytokinetics Inc shares fell 1.1 percent to $12.67 after the company disclosed a programming error in a study of its treatment for amyotrophic lateral sclerosis.
- Malaysia military source says missing jet veered to west |
- Ukraine appeals to West as Crimea turns to Russia |
- Malaysia air probe finds scant evidence of attack: sources |
- UPDATE 1-Missing Malaysian plane last seen at Strait of Malacca-source
- Libyan parliament sacks PM after tanker escapes rebel-held port