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Indexes Flat; Dow Component Caterpillar, Building Stocks Rise On Trump Remarks

Wallboard makers were among many construction stocks leading the market Monday. (©yunava1/stock.adobe.com)

The major indexes were practically flat in afternoon trading Monday, but infrastructure stocks rose after President Trump voiced new support for big spending.

The Nasdaq and S&P 500 were up a fraction. Volume was tracking lower on the NYSE and higher on the Nasdaq compared with the same time Friday.

The Dow Jones industrial average also edged up. The Dow would be lower if it weren't for Caterpillar's (CAT) 2% gain. The heavy-equipment maker rose along with steel and other infrastructure-related stocks after Trump said there's a big need to improve roads, bridges and other public works.

Metal, biotech, oil and building industry groups were leading the market today. Some construction supply stocks, in particular wallboard manufacturers, rose in heavy trading.

Eagle Materials (EXP) climbed nearly 3% as the stock found support at the 50-day moving average. Shares broke out past a 103.26 buy point on the Jan. 24 earnings announcement. But the stock then went sideways and now looks to reinvigorate its advance.

USG Corp. (USG) rose more than 2% and is nearly out of buy range from a 32.03 buy point. Three previous breakouts for the wallboard maker met with limited success, so the latest one (on Feb. 10) has been the most productive since a breakout in January 2014, which resulted in a 24% gain.

Earnings from Installed Building Products (IBP) may have pushed the housing-construction stocks higher.

The stock broke out of a base-on-base pattern, clearing a 44.40 buy point in heavy volume. The insulation installer this morning reported adjusted earnings of 44 cents a share, an increase of 29% that beat Wall Street expectations. Sales rose 22% to $234 million.

But ServiceNow (NOW) slid nearly 4% in heavy trading. A gain of as much as 11% from the 85 buy point is quickly fading, and investors who bought at that entry need to protect the profit that is still left. The cloud-computing company said CEO Frank Slootman will step down in April and is being replaced by John Donahoe, the chairman of PayPal (PYPL) and former CEO of eBay (EBAY).

Lumentum (LITE) fell all the way back to its 44.80 buy point, triggering a round-trip sell signal. The fiber-optics company broke out on strong earnings Feb. 8 and had risen nearly 20% from the buy point.

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