US STOCKS-Market flat, earnings could pierce resistance


 * Profit news next week could prove catalyst
 * S&P 500 seen testing its 2011 high
 * Pfizer to sell unit to KKR for about $2.4 billion
 * Dow up 0.2 pct, S&P up 0.1 pct; Nasdaq up 0.1 pct
 * For up-to-the-minute market news see [STXNEWS/US]
 (Updates to midday)
 By Edward Krudy
 NEW YORK, April 4 (Reuters) - The S&P 500 met tough
resistance on Monday, with the next major catalyst that could
push stocks higher not expected until quarterly earnings
reports start to arrive next week.
 Investors were cautious against a backdrop of geopolitical
risks that have weighed on equities for months.
 The benchmark S&P 500 hovered near 1,333, which it has not
closed above since mid-February. The level is double the
12-year low hit in March 2009 and not far from 1,344, the S&P's
highest since June 2008.
 Bruce Zaro, chief technical strategist at Delta Global
Asset Management in Boston, said earnings season would likely
push the S&P 500 to 1,400 by mid-May as stocks come off the
seasonally strong November-April period.
 "If we make a successful break from here, I think you've
got the 1,400 range and I think that's probably likely during
the final seasonally favorable push," he said.
 On Friday, the S&P recorded its best two-week period since
December, and the Dow industrials (.DJI: Quote, Profile, Research) hit their highest
intraday level since June 2008. Encouraging jobs data during
the week helped cement hopes of a labor market recovery.
  <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
  S&P 500 faces resistance http://r.reuters.com/daf88r
  ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 The Dow Jones industrial average (.DJI: Quote, Profile, Research) gained 20.93
points, or 0.17 percent, to 12,397.65. The Standard & Poor's
500 Index (.SPX: Quote, Profile, Research) rose 1.04 points, or 0.08 percent, to
1,333.45. The Nasdaq Composite Index (.IXIC: Quote, Profile, Research) added 2.77 points,
or 0.10 percent, to 2,792.37.
 The lack of significant economic data on Monday, nuclear
and other quake-related problems in Japan and unrest in Libya,
Syria and other countries in the oil-rich region of North
Africa and the Middle East could translate into low volume on
Wall Street. By midday the volume was the lowest so far this
year and followed the lowest weekly volume of 2011 last week.
 Brent crude extended gains to a 2-1/2-year peak above $120
a barrel on concerns over Libya's conflict, Middle East unrest
and potential supply threats. Investors are concerned that a
spike in oil could choke off a consumer recovery.
 Richard Ross, global technical strategist at Auerbach
Grayson in New York, said the S&P 500 could retake its yearly
high this week.
 "I think the market has enough inertia and the retest of
1,344 is in store," he said. "We're looking for a marginal new
high on the S&P 500 setting you up for the next leg of the
advance."
 Japanese investment bank Nomura maintained a neutral view
on semiconductor stocks, citing weakened demand, peak gross
margins and higher capital spending in the sector.
 The Philadelphia semiconductor index (.SOX: Quote, Profile, Research) fell 1 percent
and has lost 2.9 percent over the past four days.
 Pfizer Inc (PFE.N: Quote, Profile, Research) rose 0.8 percent to $20.55 after the
drugmaker agreed to sell its Capsugel unit, the world's largest
maker of hard capsules, to private equity firm KKR & Co (KKR.N: Quote, Profile, Research)
for nearly $2.4 billion.
 Shares of defense contractor General Dynamics (GD.N: Quote, Profile, Research)
dropped 5.7 percent to $73 after on of its Gulfstream Aerospace
jets crashed on a test flight, killing four.
 Southwest Airlines Co (LUV.N: Quote, Profile, Research) shares dropped 2 percent to
$12.41 after about 70 flights were canceled for safety
inspections. A Southwest jet made an emergency landing with a
hole in the cabin on Friday. [ID:nN04246437].
(Reporting by Edward Krudy; Editing by Kenneth Barry)


US STOCKS-Market flat, earnings could pierce resistance