Stocks drifted higher Monday in a fourth consecutive listless session. Traders waited for corporate financial results to start rolling in so they could look for clues about the economy.
In the unofficial kickoff to earnings season, Alcoa, considered an economic bellwether because so many companies use its products, said it lost $34 million from October through December because of lower demand for aluminum.
The loss amounted to 3 cents per share. Analysts surveyed by FactSet, a provider of financial data, had expected a loss of 2 cents per share. Alcoa said revenue was $6 billion, compared with an estimate of $5.7 billion.
The results were released after the market closed for the day. Alcoa stock finished up 2.9 percent, the biggest gain of the 30 companies in the Dow Jones industrial average. It was little changed in after-hours trading.
The Dow closed up 32.77 points, or 0.3 percent, at 12,392.69. The broader Standard & Poor’s 500 index gained 2.89 points, or 0.2 percent, to 1,280.70. The Nasdaq composite index rose 2.34, or 0.1 percent, to 2,676.56.
Analysts think profit growth slowed for U.S. multinational companies from October through December because of weaker demand overseas. Europe is on the brink of recession, and China’s explosive economy is cooling.
Quarterly profits for S&P 500 companies will probably grow at half the rate of the previous three quarters, said Sam Stovall, chief equity strategist at S&P’s Capital IQ. The companies generate about half their revenue overseas, he said.
The U.S. is in a “half-speed recovery, and that probably isn’t enough to offset the weakness in Europe and Asia,” Stovall said.
Many analysts expect materials companies such as Alcoa to suffer as developing nations expand more slowly.
