NEW YORK (AP) — U.S. stock indexes flattened in the late morning following early gains on Tuesday. Major indexes in Europe and Asia climbed ahead of a string of U.S. and Chinese economic reports later this week.
KEEPING SCORE: As of 11:40 a.m. Eastern time, the Standard & Poor's 500 index was down five points, or 0.3 percent, to 1,973. The Dow Jones industrial average fell 17 points, 0.1 percent, to 16,966, while the Nasdaq composite inched down one point, or 0.02 percent, to 4,443. With most of July behind it, the S&P 500 has clung to positive territory — up 0.8 percent.
EARNINGS STILL GROWING: This week marks the half-way point for second-quarter earnings, and the overall results look solid. Second-quarter earnings are on track to climb 8.8 percent over the year. At the start of the earnings season, analysts predicted an increase of 6 percent.
TELECOMS LEAD: Telecom companies rose the most among the 10 industry groups in the S&P 500, as traders plowed into a range of telephone and cable stocks, including AT&T and Verizon. The move came after Windstream Holdings announced plans to move some of its network into a trust that won't pay income tax. Windstream soared 19 percent and Frontier Communications jumped 16 percent to lead the S&P 500.
A DOUBLE: A large sale and a tax benefit helped Merck & Co. more than double its second-quarter profit, easily topping Wall Street's expectations. The drugmaker also raised its profit forecast for 2014. Its stock climbed 86 cents, or 2 percent, to $58.84.
OOPS: A warning of lower profits from United Parcel Service knocked its stock down in early trading. Early Tuesday, UPS said spending on technology to improve its service during the upcoming holiday season will take a cut out of its full-year earnings. The shipping company also said its second-quarter earnings fell 58 percent, though shipments and sales picked up. In early trading, UPS sank $3.56, or 3 percent, to $99.08.
BIG WEEK: Nearly a tenth of the big companies in the S&P 500 are turning in second-quarter results Tuesday. The heavyweights include American Express, Pfizer and UPS.
HOW CONFIDENT: A gauge of consumer confidence hit its highest level in nearly seven years. The Conference Board said its index increased for the third straight month in July, partially a result of people surveyed saying that it's easier to find a job.
HOUSING: House prices in 20 major U.S. cities fell slightly in May, according to the closely watched S&P/Case Shiller index. Economists had forecast a tiny gain over the previous month. Over the past year, however, housing prices have climbed 9.3 percent.
EUROPEAN MARKETS: By late afternoon in Europe, Germany's DAX was up 0.6 percent while France's CAC 40 advanced 0.4 percent. Britain's FTSE 100 rose 0.3 percent.
RUSSIA WATCH: The market's cautious gains may be tested later if Western powers go ahead with a new round of sanctions against Russia. On Monday, the White House said the United States and European Union plan to impose more sanctions this week, including penalties targeting key parts of the Russian economy. The EU had previously refrained from stepping up sanctions in the wake of the shooting down of a Malaysian jetliner over a rebel-controlled region of Ukraine, killing 298 people.
ASIA'S DAY: South Korea's Kospi reached its highest level since August 2011, rising 0.6 percent, boosted by the new finance minister's recent announcement of economic stimulus and measures to support the housing market. Hong Kong's Hang Seng finished 0.9 percent higher while China's Shanghai Composite gained 0.2 percent.
MORE DATA: On Wednesday, the U.S. will release gross domestic product figures for the April-June quarter. The world's largest economy is expected to pick up after severe winter dampened growth the previous quarter. The Federal Reserve is scheduled to issue a statement after wrapping up a two-day policy meeting on Wednesday. On Thursday, a report on China's manufacturing industry will give investors an update on the health of the world's factory floor. On Friday, the U.S. will release its monthly jobs data. Analysts estimate that the U.S. labor market added between 235,000 and 255,000 jobs in July.
ANALYST'S TAKE: William Leys, sales trader at CMC Markets, said investors were cautious before the impending rush of economic news. "Caution is the pre-eminent theme across global markets at the moment, as investors anticipate a spate of key economic data due later in the week, amid a backdrop of persistent geopolitical concerns," Leys said in a commentary. "With a variety of weighty announcements looming, the stage is set for an action packed end to the week."
OIL: The price of oil fell, with benchmark U.S. crude for September delivery down $1.05 cents to $100.63 a barrel.
Youkyung Lee contributed to this story from Seoul, South Korea.
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