Stocks edged lower on Monday as investors took profits before moves by euro zone officials to keep a debt crisis contained, but the S&P 500 stood within points of a new high for the year.
The finance ministers were under pressure as they met to increase the size of a 750 billion euro safety net for debt-stricken members. But Germany rejected any such move.
Despite the day's dip, analysts see the S&P 500 soon breaking out of its recent range and surpassing its current intraday high for the year just above 1,227 reached on November 5.
We're at the April highs. We're backing and filling, and we've been doing that since November 3. The presumption is a little bit longer, not that much, and then it will be free to break out, said Carter Worth, chief market technician at Oppenheimer & Co in New York.
The objective would be 1,280 (on the S&P 500)...something between a 4 to 5 percent advance from the breakout jump here.
Also looking ahead in equities, Goldman Sachs Asset Management Chairman Jim O'Neill, speaking at the Reuters Investment Outlook Summit in New York, gave a bullish view on stocks, saying global equity markets are likely to see gains of up to 20 percent through 2011.
A decline in the euro added to the pressure on stocks. Stocks and the euro have moved in tandem of late, with the euro view as a proxy for debt concerns.
The Dow Jones industrial average <.DJI> was down 22.36 points, or 0.20 percent, at 11,359.73. The Standard & Poor's 500 Index <.SPX> was down 3.09 points, or 0.25 percent, at 1,221.62. The Nasdaq Composite Index <.IXIC> was down 3.39 points, or 0.13 percent, at 2,588.07.
Technology shares limited declines after positive brokerage comments on Cisco Systems Inc
Over the weekend U.S. Federal Reserve Chairman Ben Bernanke told the CBS television program 60 Minutes the Fed could end up increasing its commitment to buy $600 billion in U.S. government bonds if the economy fails to respond or unemployment stays too high.
(Additional reporting by Leah Schnurr; Editing by Kenneth Barry)