* Alcoa shares slip in volatile extended trade after results
* 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 0.6 pct, S&P 500 up 0.5 pct, Nasdaq up 0.2 pct
By Leah Schnurr
NEW YORK, July 8 (Reuters) - U.S. stocks advanced on Monday
heading into the start of earnings season, building on gains
sparked by last week's robust employment report and pushing the
S&P 500 closer to its all-time high set in May.
Dell Inc shot up 3.1 percent to $13.44 after the
largest U.S. shareholder advisory firm recommended that
shareholders vote for Chief Executive Michael Dell's $24.4
billion buyout offer.
Investors have been largely focused in recent months on when
and to what degree the Federal Reserve will slow its $85
billion-a-month bond purchase program, which has been a major
driver of the stock market's rally this year.
Markets were rattled by Fed Chairman Ben Bernanke's comments
last month that the economy is expanding briskly enough for the
central bank to pull back on the pace of purchases later this
Still, investors were encouraged by last Friday's
better-than-expected jobs report as it suggested the economy was
on good footing, even as the figures were seen as increasing the
likelihood that the Fed's stimulus will be cut in the near-term.
Firms that deal directly with the Fed now see the stimulus
reduction starting in September, a Reuters poll showed.
The improved view of the economy, combined with investors
turning their attention to earnings season, helped send equities
higher, said Bucky Hellwig, senior vice president at BB&T Wealth
Management in Birmingham, Alabama.
"There's really not a reason to sell stocks today," Hellwig
said. "There's a high level of comfort with the earnings season
and with the strong job market."
The S&P 500 has climbed in four out of the past five
sessions, putting the benchmark less than 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 Dow Jones industrial average gained 88.85 points,
or 0.59 percent, to end at 15,224.69. The Standard & Poor's 500
Index rose 8.57 points, or 0.53 percent, to 1,640.46. The
Nasdaq Composite Index added 5.45 points, or 0.16
percent, to close at 3,484.83.
Dow component Alcoa Inc, the largest U.S. aluminum
producer, reported results after the market's close, which is
typically seen as the start of earnings season.
Alcoa reported a larger-than-expected quarterly profit,
excluding one-time items such as restructuring costs and legal
expenses. Its stock slipped 0.6 percent after hours, reversing
earlier gains in extended trading. In the regular session, Alcoa
rose 1.4 percent to close at $7.92.
Analysts expect S&P 500 companies' earnings to rise 2.9
percent in the second quarter from a year ago, though that is
down from the 5.4 percent growth seen in the first quarter,
according to Thomson Reuters data. Quarterly revenue is forecast
to increase 1.5 percent from a year ago.
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
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 4 percent at
But technology shares waned and the Nasdaq fared worse than
the other two major indexes to end only slightly higher.
Intel Corp weighed on the Nasdaq and was the S&P
500's worst performer, sliding 3.6 percent to $23.19, after
analysts at Evercore Partners downgraded the company's stock.
The drop took the stock down to its lowest level since late
Volume was roughly 6.08 billion shares on the New York Stock
Exchange, the Nasdaq and the NYSE MKT, compared with a daily
average of about 6.4 billion shares this year.
Advancers had the upper hand on the NYSE, beating decliners
by a ratio of about 3 to 2. On the Nasdaq, about seven stocks
rose for every five that fell.