Stocks strive for record, come up short

NEW YORK (CNNMoney.com) -- Stocks posted modest gains Monday, just missing new record highs, as weary traders eyed the upcoming earnings reports, which began after the closing bell with Alcoa.

The 30-stock Dow Jones industrial average (up 38.29 to 13,649.97, Charts) rose about 0.3 percent. The broader S&P 500 (up 1.41 to 1,531.85, Charts) and the tech-heavy Nasdaq (up 3.51 to 2,670.02, Charts) each rose about 0.1 percent.

The Dow and the S&P flirted with record trading highs all day, coming within about 20 points several times during the session. But in the end, neither established a new trading or closing benchmark.

After the bell, aluminum giant Alcoa, the first major company to report second quarter results, said profit slipped, partly due to charges for a pending acquisition.

Alcoa (Charts, Fortune 500) posted profits of 81 cents a share, down from 85 cents a share but in-line with Wall Street estimates. Shares fell 1 percent in after hours trade.

During the regular session the near-highs for stocks, coupled with earnings anxiety, kept many investors on the sidelines.

"We took some money off the table," said Brian Gendreau, a strategist at ING Investment Management in New York City. "[The market] is pretty close to being fairly valued."

Last week the Dow rose an impressive 1.5 percent, while the S&P 500 muscled its way to a 1.8 percent gain.

"Just common sense alone tells you that's too much," said Hugh Johnson, chairman of the asset management company Johnson Illington Advisors. "I don't care what the news is, we take a breather."

Johnson said investors are nervous as projections call for a big slowdown in earnings after 14 consecutive quarters of double-digit growth.

"Until we see the earnings numbers, no one wants to make any commitments," he said. "It would be very foolish to do so."

Earnings at S&P 500 companies are expected to grow 4.4 percent this quarter, according to First Call.

That's down from 9.3 percent last quarter and double-digit growth in the prior 14 quarters, Johnson said. But earnings last quarter came in roughly twice as strong as estimates, so traders will wait to see if the good luck can continue.

In corporate news Monday, Boeing (up $1.02 to $99.90, Charts, Fortune 500) got a boost from the unveiling of its 787 Dreamliner in a Sunday ceremony in Everett, Wash. New orders announced over the weekend bring the company's order total for the plane to more than $100 billion. Shares rose about 1 percent.

On the deal front, private equity firm The Carlyle Group announced a $2.7 billion deal to buy diversified manufacturer Sequa Group, agreeing to pay a premium of 54 percent to Friday's closing price. Sequa (Charts) shares rose by a similar amount.

Chemical giant Huntsman (up $0.07 to $28.07, Charts, Fortune 500) received a sweetened offer from buyout firm Apollo Management, according to a report in the Wall Street Journal.

And Johnson & Johnson's (up $0.59 to $62.72, Charts, Fortune 500) board of directors approved the repurchase of up to $10 billion in stock. Shares rose about 1 percent.

Treasury prices rose, lowering the yield on the 10-year note to 5.14 percent, down from the 5.18 percent level reached late Friday. Bond prices and yields move in opposite directions.

The dollar fell slightly versus the euro and yen.

Oil prices fell, with U.S. light crude down 76 cents to settle at $72.05 a barrel on the New York Mercantile Exchange.

Overseas, European stocks gained and major Asian markets rallied.

Market breadth was mixed. Winners edged out losers on the New York Stock Exchange as 1.33 billion shares changed hands. On the Nasdaq, decliners narrowly topped advancers on volume of 1.88 billion shares.