April 9, 2013 / 2:35 PM / 5 years ago

US STOCKS-Wall St flat as earnings season starts

* U.S. earnings season in view, keeps investors sidelined

* J.C. Penney tumbles after CEO shake-up

* Alcoa falls after revenue misses expectations

* Dow up 0.4 pct, S&P down 0.01 pct, Nasdaq up 0.01 pct

By Leah Schnurr

NEW YORK, April 9 (Reuters) - U.S. stocks were little changed on Tuesday as investors were wary of initiating large bets at the start of the earnings season, which is forecast to show only modest growth.

J.C. Penney was the largest loser on the S&P 500 as its shares slid 10.8 percent to $14.16 after the department store chain replaced Chief Executive Ron Johnson with his predecessor.

Major indexes swung between gains and losses in early trading. Forecasts for U.S. first-quarter earnings have been scaled back in 2013, with profits seen rising just 1.6 percent from the year-ago quarter, according to Thomson Reuters data. In January, earnings were seen rising 4.3 percent.

While analysts said the low bar could mean some companies might handily beat expectations, Wall Street is also vulnerable to a pullback after this year’s rally that has pushed stocks to record highs.

But the liquidity stemming from the Federal Reserve’s ultra-loose monetary policy means stocks will see more of a “rolling correction” among sectors than a large sell-off, said Dan Veru, chief investment officer at Palisade Capital Management LLC in Fort Lee, New Jersey.

“I‘m expecting us to be in this sideways period where you’ll have some outperforming sectors that might be subject to profit-taking and some underperforming sectors that might get attention,” he said.

Alcoa Inc, the first Dow component to release results, reported a higher quarterly profit but lower-than-expected revenue after the bell on Monday. Shares of the largest U.S. aluminum producer slipped 0.4 percent to $8.36.

The Dow Jones industrial average rose 20 points, or 0.4 percent, to 14,636. The Standard & Poor’s 500 Index edged down 0.15 point, or 0.01 percent, at 1,562.92. The Nasdaq Composite Index added 0.48 points, or 0.01 percent, to 3,222.73.

Shares of Herbalife were halted pending news. The New York Times reported KPMG will resign as the auditor of the company after a KPMG partner was fired for leaking non-public information on companies the firm audited.

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