NEW YORK (Reuters) – Stocks drifted on Monday as investors were reluctant to push stocks higher after briefly touching another high for the year.

The dollar rose against other major currencies while the euro fell, hitting a record low against the Swiss franc and a two-week low versus the greenback as investors fretted over euro zone debt problems.

Investors were reluctant to push stocks higher after a run of solid economic data, which has pushed the Standard & Poor’s 500 benchmark index up 5.4 percent for the month and 11.6 percent for the year.

“We are a little elevated here. We’ve got a little bit of a nosebleed going,” said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.

Among several deal announcements, AT&T Inc (T.N) said it would buy wireless spectrum licenses from Qualcomm Inc (QCOM.O) in a deal worth $1.9 billion. Qualcomm rose 0.3 percent to $49.59. AT&T dipped 0.5 percent $29.05.

The Dow Jones industrial average (.DJI) dropped 29.90 points, or 0.26 percent, to 11,462.01. The Standard & Poor’s 500 Index (.SPX) gained 0.34 points, or 0.03 percent, to 1,244.25. The Nasdaq Composite Index (.IXIC) dropped 0.62 points, or 0.02 percent, to 2,642.35.

U.S. markets will be closed on Friday to observe the Christmas Day holiday on Saturday.

Dow component Boeing Co (BA.N), down 2.7 percent to $63.27, kept indexes in check. Traders cited reports the plane maker’s troubled Dreamliner may be delayed once again, which could put its contracts in jeopardy with airlines.

“It sounds like some of the airlines are getting sick of the delays in this Dreamliner and that is why it is down.” added Massocca.

Raytheon Co (RTN.N) shed 0.4 percent to $44.99 after the defense contractor said it will acquire Applied Signal Technology Inc (APSG.O) for $490 million. Applied Signal shares rose 7.9 percent to $37.80.

Underscoring expectations of strong holiday spending, U.S. online sales are up 12 percent to $27.5 billion so far this season compared with a year ago.

Shares of Adobe Systems Inc (ADBE.O), which reports quarterly results later in the day, were up 1.9 percent to $29.34.

Food and beverage company Sara Lee Corp (SLE.N) has been in talks to sell itself to Brazilian meat producer JBS (JBSS3.SA), but the two companies are at odds over price, a source said. Sara Lee shares rose 1.4 percent to $17.50.

(Editing by Kenneth Barry)

NEW YORK (Reuters) – Not even earnings from big names like Google and GE next week will be able to pull Wall Street’s focus away from the possibility of more cheap cash flowing in from the Federal Reserve.

Normally when the likes of JPMorgan or Intel –also reporting next week — tell investors how much they earned in the previous quarter, the stock market hangs on every word.

But after Friday’s surprisingly anemic payrolls report, the increased likelihood the Fed will buy more assets like Treasury bonds to stimulate the economy has investors ignoring the usual benchmarks.

“Markets have been oscillating between macro and micro data, and the upcoming week will focus on macro,” said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management in Menomonee Falls, Wisconsin.

The fact that Wall Street closed Friday in the black despite the weak payrolls data is evidence the Fed’s action is top of mind for investors at this time.

Action from the central bank has already been baked into the equities rally, with $500 billion as the most talked-about injection. And the risk of a decline in equities is off balance as both good and bad economic news could have a bullish effect on stocks.

“Good news is clearly good and the market goes up,” said John Praveen, chief investment strategist at Prudential International Investments Advisers LLC in Newark, New Jersey.

“If earnings or economic news is bad, then we’ll get” a second round of quantitative easing, he noted. “Therefore the market will still go up. In that sense, risk is asymmetric.”

Economic data next week, including consumer and producer prices, retail sales and consumer sentiment could shed further light on whether the economy has slowed enough to require swift action from the Fed.

“If CPI shows core inflation is going to fall, further odds of aggressive QE –as opposed to a trickle — will increase and that will be viewed positively by the market,” said Praveen.

EARNINGS TAKE BACK SEAT

Intel Corp (INTC.O), JPMorgan Chase & CO (JPM.N), Google Inc (GOOG.O) and General Electric Co (GE.N) are among the largest companies that will post earnings next week. Intel warned in late August that its revenue could fall short and its shares got punished, so there’s little space for a negative surprise.

And if Alcoa’s report on Thursday was any indication, even bellwethers’ numbers may have to vary enormously from expectations to be noted amid all the QE2 talk.

Alcoa Inc (AA.N) marked the unofficial start to earnings season, rising 5.7 percent to $12.89 a day after its results beat estimates. While the stock rose sharply, it was far from the market’s focal point, which hinged on the expectation of the Fed’s action.

And next week’s Treasury auctions, especially of longer-term bonds, may also provide a boost to stocks.

Investors are getting fatigued and bids on the 30-year bond might be a little bit weaker from past auctions, according to Wells Fargo’s Jacobsen.

A decline in interest would suggest “people are more interested in going into equities rather than bonds,” he said.

Turning the balance even further in favor of the bulls, expectations of more easing from the U.S. central bank should keep the dollar on a downtrend, which is another signal of gains for Wall Street.

An inverse correlation between the greenback and U.S. stocks has prevailed strongly in the last weeks The 30-day correlation between the S&P 500 (.SPX) and the dollar index (.DXY) was at -0.88, while the 50-day correlation was -0.89.

That said, with the International Monetary Fund meeting discussing the issue of competitive currency devaluations and shorts on the U.S. dollar piling up, a big move up on the greenback may become a hurdle for stocks.

OPTIONS CALL FOR CALM MARKET

S&P 500 charts show the previous resistance at 1,150 has turned into short-term support, with the next resistance level around 1,170-1,175. The current trend channel doesn’t hit that area until late next week.

Options trading implies low volatility levels, as reflected by the CBOE Volatility Index (.VIX) and the CBOE Nasdaq 100 Volatility Index (.VXN), said Scott Fullman, director of derivative investment strategy at WJB Capital Group.

“While the rally appears to have stalled,” he said, “we continue to see indications of an upward bias toward prices.”

(Reporting by Rodrigo Campos; Additional reporting by Doris Frankel in Chicago; Editing by Jan Paschal)

NEW YORK – Stocks are closing barely higher after more caution from the Fed erased early gains in major market indexes.

The Dow Jones industrial average eked out a gain of 5 points Tuesday. The market is closing out its worst August in nine years as concerns mount about the economy.

Minutes from a Fed meeting earlier this month showed that central bank officials are still concerned about the economy.

According to preliminary calculations, the Dow is closing down 5 at 10,014.

The Standard & Poor’s 500 index edged up less than a point to 1,049. The Nasdaq fell 6, or 0.3 percent, to 2,114.

Rising stocks outpaced falling ones on the New York Stock Exchange, where volume came to 1.4 billion shares.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

NEW YORK (AP) — Stocks pared their gains Tuesday afternoon after minutes from a Federal Reserve meeting showed central bank officials are still concerned about the economy.

The minutes from the Fed’s Aug. 10 meeting showed that the bank recognized the economy might need further stimulus beyond purchases of government debt. Some members of the Fed’s policy-setting committee acknowledged the economy had softened more than they had anticipated.

Stocks had been higher earlier in the day following a surprisingly high reading on consumer confidence in August. The report provided a respite from a string of disappointing news on the economy, which has sent stocks slumping sharply since Aug. 9.

The Dow Jones industrial average rose 23 points in afternoon trading but is still down 4.1 percent for the month.

“Market pessimism in the very near-term has hit a nadir,” said John Brady, a senior vice president at MF Global.

The small rise in confidence took the edge off the downbeat mood, however many traders are hesitant to make big moves before Friday’s key monthly report on employment, Brady said. Analysts expect that the unemployment rate inched higher last month.

Treasury prices also climbed, indicating there are plenty of investors still nervous about the health of the economy and seeking the relative safety of government bonds.

In late afternoon trading, the Dow was up 23, or 0.2 percent, to 10,032.8.

The Standard & Poor’s 500 index rose 3, or 0.3 percent, to 1,051.57. The Nasdaq fell 3, or 0.2 percent, to 2,116.73.

Gaining stocks narrowly outpaced losing ones on the New York Stock Exchange, where volume was very light at 840 million shares.

NEW YORK (Reuters) – Stocks dropped on Friday after government data showed a larger-than-expected drop in July payrolls, lending more weight to concerns of a slow economic recovery.

Stocks had been rising for the past month, largely on the back of corporate earnings, and the S&P remains up nearly 9 percent from its low for the year reached on July 2.

But Friday’s declines once again pushed the S&P 500 into negative territory for the year and the benchmark index fell below its 200-day moving average, now around 1,115, a level which had previously provided support.

“Investors get optimistic that we are turning the corner, things are going to improve, then we get these numbers again,” said Terry Morris, senior equity manager for National Penn Investors Trust Co in Reading, Pennsylvania.

“We want to think that it’s improving, but we keep getting nailed.”

The U.S. economy lost 131,000 jobs in July — more than twice the decline of 65,000 that economists forecast in a Reuters poll. And the closely watched private employment number rose less than expected.

Consumer stocks ranked among the biggest losers as the monthly jobs report heightened worries about consumer spending, which accounts for about two-thirds of U.S. economic activity. Retailer Office Depot (ODP.N), which sells school and office supplies, slid 7.8 percent to $4.50, while the S&P consumer discretionary index (.GSPD) fell 1.5 percent.

The Dow Jones industrial average (.DJI) fell 134.11 points, or 1.26 percent, to 10,540.87. The Standard & Poor’s 500 Index (.SPX) lost 15.51 points, or 1.38 percent, to 1,110.30. The Nasdaq Composite Index (.IXIC) shed 28.71 points, or 1.25 percent, to 2,264.35.

The downward turn in the S&P 500′s short-term momentum is “a bit of a negative,” according to Bruce Zaro, chief technical strategist at Delta Global Advisors in Boston, but he said he won’t be concerned if the index pulls back to 1,080 or slightly below.

But other chartists point out that a close below the 200-day moving average could mean the S&P’s daily chart generated a “double top,” which would be seen as a bearish signal.

In mid-June, the benchmark S&P 500 closed above its 200-day moving average for five straight days before a two-week slide that took it down to its 2010 low in early July.

Dow component Kraft Foods Inc (KFT.N) was among the few bright spots, rising 2.3 percent to $30.35 after the company, whose products include Kraft cheese and Maxwell House coffee, reported a higher-than-expected quarterly profit. Kraft also raised its target for cost savings from its acquisition of Cadbury, the British company known for its chocolates.

Shares of grain companies like Archer Daniels Midland Co (ADM.N) and Bunge Ltd (BG.N) edged lower after rallying more than 5 percent on Thursday. Investors took profits a day after wheat prices soared on Russia’s suspension of grain shipments because of its worst drought in a century.

Bunge dipped 0.1 percent to $54.41, while Archer Daniels Midland slipped 0.7 percent to $30.04.

(Additional reporting by Rodrigo Campos)