NEW YORK (CNNMoney.com) -- U.S. stocks were set to open higher Monday as investors digest reports on income and spending and await the week's big events - the midterm election, the Federal Reserve meeting and the October jobs data.
Stocks have been climbing since late August on expectations of additional stimulus from the Federal Reserve and bets that Tuesday's Congressional elections will favor the Republicans.
But the tone has been more cautious recently, with stocks mostly moving sideways over the last week, as investors take a wait-and-see attitude ahead of the election and the Fed's policy statement on Wednesday.
Chinese stocks moved higher overnight on strong manufacturing numbers, but the gains failed to spill over to other Asian stocks, with Japan's Nikkei ending modestly lower.
While economic reports due out Monday on U.S. manufacturing and personal income are important, they will likely be overshadowed by the impending elections and Fed announcement.
"We could have a nervous couple of days here," said David Jones, chief market strategist at IG Markets. "If they [the Fed] don't meet expectations, investors might be happy to take some money out of the market."
Economy: A report on personal income and spending before the bell showed that personal income decreased 0.1% while personal spending increased 0.2% in September.
Economists had expected the Commerce Department to report that spending by individuals rose 0.4% in September, according to a consensus estimate from Briefing.com. Personal income was expected to have risen 0.2% in the month.
Investors are still waiting on a key manufacturing index due shortly after the market opens.
The Institute for Supply Management's manufacturing index for October was expected to have eased to 54 from 54.4 in September. Any reading above 50 indicates growth in the sector.
Separately, government data was expected to show that construction spending fell 0.7% in September.
Companies: AIG (AIG, Fortune 500) announced early Monday that it has raised nearly $37 billion by selling off one insurance subsidiary, and the initial public offering of a second, AIA Group Ltd. AIG's stock edged up modestly in premarket trading.
Before the bell, Loews (L, Fortune 500) reported that its net income dropped in the third quarter to $36 million, compared to $468 million in 2009. That included a one-time charge of $328 million stemming from CNA Financial Corporation, a subsidiary. Excluding that charge, Loews reported earnings of 13 cents per share, topping analyst expectations. Shares were little changed.
World markets: European shares rose in midday trading. The CAC 40 in France, the DAX in Germany and Britain's FTSE 100 were all up about 1.0%.
Asian markets ended mixed. Japan's benchmark Nikkei index dropped 0.5%, while the Hang Seng in Hong Kong rose 2.4%. The Shanghai Composite ticked up 2.5%.
Oil futures for December delivery increased to $82.30 a barrel.
Gold for December delivery rose to $1363.80 an ounce.
Bonds: Prices on U.S. Treasuries rose Monday, pushing the yield on the benchmark 10-year note down to 2.60% from 2.61% late Friday.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.73%||3.76%|
|15 yr fixed||2.93%||2.96%|
|30 yr refi||3.80%||3.83%|
|15 yr refi||3.01%||3.04%|
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