* Caterpillar profit stronger than expected, shares rally
* Apple earnings due after markets' close
* U.S. new home sales fall for second straight month in Dec
* Dow up 0.2 pct, S&P down 0.1 pct, Nasdaq down 0.6 pct
By Caroline Valetkevitch
NEW YORK, Jan 27 The S&P 500 and Nasdaq extended
last week's selling on Monday after weaker-than-expected new
home sales data and ongoing concerns about emerging markets,
while the Dow gained with shares of Caterpillar on strong
The technology sector led losses but both the S&P 500 and
the Nasdaq pared earlier losses.
The day's mixed moves follow a steep selloff late last week
mainly tied to concerns about emerging market growth.
"There's still a lot of nervous money hanging around," said
Bucky Hellwig, senior vice president at BB&T Wealth Management
in Birmingham, Alabama.
"We still see stress in the emerging markets. We see
questions about China's growth. The Fed is meeting this week and
the consensus is they're going to proceed with the taper."
Monday's data showed sales of new U.S. single-family homes
fell more than expected in December.
The Fed's two-day policy meeting begins on Tuesday. Many
market participants expect another selloff if the Fed decides to
keep withdrawing stimulus, further pressuring equities already
roiled by a flight from emerging markets last week.
Big technology names weighed on the market. Google shares
were off 1.2 percent at $1,110.48. Microsoft shares
lost 1.2 percent to $36.36.
The Dow Jones industrial average rose 27.45 points or
0.17 percent, to 15,906.56, the S&P 500 lost 1.17 points
or 0.07 percent, to 1,789.12 and the Nasdaq Composite
dropped 23.424 points or 0.57 percent, to 4,104.749.
Last week's heavy selling raised concerns the market may be
in for a major correction, especially with the S&P 500 closing
below its 50-day moving average for the first time since Oct. 9.
The Nasdaq briefly fell below its 50-day moving average on
Caterpillar shares jumped 4.7 percent to $90.27
after stronger-than-expected quarterly profit. Cost cuts and an
uptick in demand for building equipment offset continued weak
sales to the mining industry.
Apple Inc, up 1.3 percent at $552.97, is due to
report earnings after the close of trading. It may notch its
most successful holiday shopping season yet, setting records for
sales of its gift-friendly iPhones and iPads. Apple will,
however, continue to draw investor scrutiny over sales in
ultra-competitive China, its No. 2 market but a drag on revenue
and margins in recent quarters.