Stocks set for initial '10 gain

NEW YORK (CNNMoney.com) -- Stocks were poised to start the new year with gains Monday as investors await two economic reports and consider weekend comments by Federal Reserve Chairman Ben Bernanke.

Dow Jones industrial average, Nasdaq-100 and S&P-500 futures were higher. Futures measure current index values against their perceived future performance and offer an indication of how markets may open when trading begins.

Stocks slumped Thursday in a thinly-traded session on the last day of 2009, but all three major indexes ended the year up. The markets were closed Friday in observance of New Year's Day.

In 2009, the S&P 500 gained 23.4%, the Dow industrials gained 18.8% and the Nasdaq added 44%.

Philip Isherwood, equities strategist at Evolution Strategies in London, said Wall Street is being propelled by strong manufacturing reports from China and South Korea, and the expectation that the United States will also report strong manufacturing activity.

"The big story is data flow, and within that is the ISM manufacturing, which is expected to pick up again," he said.

Also, Isherwood said the U.S. government is expected to release payroll numbers on Friday that "will carry on their benign trend."

Economy: After the market opens, a report is expected to show construction spending fell 0.5% in November after staying flat the previous month, according to a consensus of analysts polled by Briefing.com.

At 10 a.m. ET, the Institute for Supply Management's reading on manufacturing is predicted to have risen to 54 in December from 53.6 the previous month, and a separate report is expected to show factory orders rose 0.5% in November.

Bernanke: Federal Reserve chairman Bernanke said Sunday that low interest rates in the first half of the last decade were "appropriate" at the time and were not the main cause of the ensuing housing bubble.

Speaking at the American Economic Association conference in Atlanta, Bernanke also said regulation would have been a better way to end the housing bubble, calling monetary policy -- the raising and lower of interest rates -- "a blunt tool." (Bernanke defends Fed record)

World markets: Stocks in Asia closed mixed Monday, with Tokyo's Nikkei index up 1% and Hong Kong's Hang Seng index finishing 0.2% lower. European indexes were higher in midday trading.

Money, oil, gold and bonds: The dollar eased versus major international currencies, including the euro, the yen and the U.K. pound.

Crude oil for February delivery surged $1.48 to $80.84 a barrel.

Gold for February delivery rallied $21.30 to $1,117.50 an ounce.

The price rose on the 10-year note, while the yield slipped to 3.85%.