Industrial average rises on hopes of an upturn in manufacturing

NEW YORK - Hopes that global manufacturing activity is heating up lifted industrial stocks Monday ahead of an earnings report from Alcoa Inc.

The Dow Jones industrial average rose 46 points, while the broader Standard & Poor's 500 index advanced for a sixth straight day. The Nasdaq composite index slipped.

After the closing bell, Alcoa posted revenue that topped expectations, but profits excluding one-time costs fell short of forecasts. The report from the aluminum producer gave traders one of the first looks at how companies fared in the final quarter of 2009.

The Alcoa numbers followed a report that China's exports jumped 18 percent in December. The bigger-than-expected increase came after 13 straight months of declines and raised hopes that the world economy is strengthening.

"The global economy is healing," said Roy Williams, CEO of Prestige Wealth Management Group in Flemington, N.J. Williams cautioned that the recovery will still face "a lot of potholes." On Friday, for example, the Labor Department reported a larger-than-expected number of job losses for December.

Some parts of the market that rose Monday signaled investors remain cautious. Utilities and consumer staples rose -- areas seen as safer because they produce necessities.

Earnings reports begin arriving in greater numbers next week and will shape traders' assessment of the economy.

The S&P 500 index has risen each day in 2010. The only other time the index has risen the first six trading days of the year was in 1987, when it advanced for seven straight days. The 2.9 percent gain so far in 2010 is a sharp contrast to the slide of 1.4 percent the S&P 500 index logged in the early days of last year.

The market's rise is a promising sign. The S&P 500 index posted full-year gains 31 of the last 36 times that it rose in the first week of the year, according to Stock Trader's Almanac.