The S&P 500 and Nasdaq edged higher on Monday as several bellwethers rose on brokerage upgrades and positive comments about the economy, but worries about euro zone sovereign debt problems limited gains.
Worries about Greece's financial problems and other fiscally fragile euro zone countries has dragged Wall Street about 7 percent lower since mid-January.
But brokerage upgrades lifted shares of Dow components Home Depot Inc
In its upgrade of Home Depot, Morgan Stanley said it was optimistic about the home improvement chain's prospects as the housing market begins to recover.
JPMorgan cited improving economic conditions in its upgrade of Disney, but said the entertainment company's earnings recovery would lag its peer group.
Over the weekend, European finance ministers tried to assure their counterparts in the Group of Seven industrialized nations that the euro zone's debt crisis is under control.
There's a tug-of-war in the markets between the good news of the upgrades and strong earnings, and the bad news of the European debt, said John Praveen, chief investment strategist at Prudential International Investments Advisers LLC in Newark, New Jersey.
The macro picture for the United States is improving, and if we didn't have the debt issue, the markets would be rallying today on all the good news.
The Dow Jones industrial average <.DJI> fell 7.55 points, or 0.1 percent, to 10,004.98. The Standard & Poor's 500 Index <.SPX> gained 2.70 points, or 0.25 percent, to 1,068.89. The Nasdaq Composite Index <.IXIC> was up 8.34 points, or 0.39 percent, to 2,149.47.
Financial stocks came under pressure. JPMorgan Chase & Co
Lifting the Nasdaq was Amazon.com Inc
Other gainers included Hasbro Inc
Hasbro also said it expects its revenue and profit to rise in 2010, sending its shares up 14 percent to $34.96. CVS rose 6.3 percent at $33.02.
On the downside, Nasdaq OMX Group Inc
(Editing by Kenneth Barry)