Wall Street inches up as oil pulls back, data supportive

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NEW YORK (Reuters) - Stocks inched higher on Monday as oil prices retreated after recent sharp gains and data showed further improvement in the U.S. housing market.

The Dow Jones home construction index (:.DJUSHB) climbed 1.6 percent.

The S&P 500 has risen nearly 9 percent so far this year. It has been stuck in a tight range between 1,355 and 1,370 as expectations that the index is due to consolidate after the strong gains have vied against data pointing to a firmer U.S. economic recovery, including improvement in the key housing and labor markets.

"A lot of positives are unfolding in the U.S., but a lot of that has been priced into this rally we've had since the fall. With the earnings season over, we may see a little bit of pullback," said Natalie Trunow, chief investment officer of equities at Calvert Investment Management in Bethesda, Maryland, which has about $13 billion in assets.

The S&P briefly rose above 1,370.58, its highest level since June 2008 and a key resistance point.

Oil prices have put a brake on gains in the S&P in recent weeks, spurred higher by worries over disruptions to Middle East supplies due to sanctions against Iran along with expectations for greater demand from an improving U.S. economy.

Brent crude was down more than $1 a barrel on Monday after hitting a 10-month high on Friday.

The Dow Jones industrial average (DJI:^DJI - News) was up 24.10 points, or 0.19 percent, at 13,007.05. The Standard & Poor's 500 Index (SNP:^GSPC - News) was up 3.47 points, or 0.25 percent, at 1,369.21. The Nasdaq Composite Index (Nasdaq:^IXIC - News) was up 7.71 points, or 0.26 percent, at 2,971.46.

Stocks also got a boost after an industry group reported that contracts for home resales hit a near two-year high in January, that latest evidence that the industry may be in the beginning stages of a recovery.

The PHLX housing sector index (Nasdaq:^HGX - News) climbed 1.1 percent, buoyed by an advance in shares of building materials maker Owens Corning (NYSE:OC - News), up 3.7 percent at $32.03.

Lowe's Cos (NYSE:LOW - News), the world's second-largest home improvement chain, reported higher-than-expected quarterly sales, and its shares rose 0.6 percent to $27.33.

Through Monday morning, of the 468 S&P 500 companies that have reported earnings for the most recent quarter, 63 percent have beaten analyst expectations. More than 20 companies in the index are expected to report results this week.

Biotech stocks fell after Dendreon Corp (NasdaqGS:DNDN - News) said demand was soft for its high-priced Provenge prostate cancer treatment as the year began, and it forecast low-single-digit sales growth in the first quarter.

Dendreon slumped 19.4 percent to $11.98. The NYSEArca biotech index (:.BTK) lost 1.4 percent.

[tu_holmes]

This probably helped:

TransCanada touts oil pipeline from Okla. to Texas

By MATTHEW DALY, Associated Press

WASHINGTON (AP) — A Canadian company said Monday it will build an oil pipeline from Oklahoma to Texas after President Barack Obama blocked the larger Keystone XL pipeline from Canada.

Calgary-based TransCanada says the new project does not require presidential approval, since it does not cross a U.S. border. The shorter pipeline is expected to cost about $2.3 billion and be completed next year, the company said.

The Obama administration had suggested development of an Oklahoma-to-Texas line to alleviate an oil glut at a Cushing, Oklahoma, storage hub.

Press secretary Jay Carney said Obama welcomed the announcement.

"Moving oil from the Midwest to the world-class, state-of-the-art refineries on the Gulf Coast will modernize our infrastructure, create jobs, and encourage American energy production," Carney said in a statement. "We look forward to working with TransCanada to ensure that it is built in a safe, responsible and timely manner, and we commit to take every step possible to expedite the necessary federal permits.

TransCanada said Monday it still hopes to build the full 1,700-mile (2,735-kilometer) Keystone XL pipeline, which would carry oil derived from tar sands in Alberta, Canada to refineries along the Texas Gulf Coast. The proposed $7 billion pipeline would run through Montana, South Dakota, Nebraska and Kansas before reaching Oklahoma.

The company is working with Nebraska officials to find a route that avoids the environmentally sensitive Sandhills region.

Obama rejected the Keystone XL pipeline last month, in large part because of the uncertainty over the Nebraska route. Obama said there was not enough time for a fair review before a looming deadline forced on him by Republicans. The action did not kill the project but — for the second time in three months — put off a tough choice on the pipeline project, which has become the focus of a heated political fight.

Pipeline supporters — including congressional Republicans and many business and labor leaders— call the project a key job creator, while opponents say it would transport "dirty oil" that requires huge amounts of energy to extract. They also worry about a possible spill.

Carney said that Obama's Jan. 18 decision "in no way prejudged future applications" by TransCanada for the full, 1,700-mile project.

"We will ensure any project receives the important assessment it deserves, and will base a decision to provide a permit on the completion of that review," he said.

Russ Girling, TransCanada's president and CEO, said the Oklahoma-to-Texas pipeline will transport growing supplies of U.S. crude oil to meet refinery demands in Texas.

"Gulf Coast refineries can then access lower cost domestic production and avoid paying a premium to foreign oil producers," he said, adding that the project should reduce U.S. dependence on crude from outside North America.