* Stocks tread water with U.S. election on horizon
* Dollar gains as Fed decision could have delayed impact
* Treasury price swings are a sign of low volume
* Oil rises after Saudis say higher prices possible
(Adds close of U.S. markets, changes byline)
By Herbert Lash
NEW YORK, Nov 1 (Reuters) - Oil prices and the dollar rose
on Monday, spurred by strong U.S. and Chinese manufacturing
data, as investors awaited mid-term U.S. congressional
elections and more monetary easing from the Federal Reserve in
the days ahead.
U.S. factory activity in October expanded and construction
spending rose unexpectedly in September, reports showed. Other
data showed manufacturing in China expanded at the fastest pace
in six months in October. For details, see []
[].
Traders have for months been singularly focused on the Fed,
which appears very close to resuming an ambitious program of
large-scale asset purchases to stir the sluggish U.S. economic
recovery out of its doldrums. []
But investors were reluctant on Monday to make big bets
ahead of the election and the Fed's policy-setting meeting that
ends on Wednesday, events that could dictate the market's
direction well into new year.
The Dow and S&P 500 posted slight gains while the Nasdaq
edged lower. Gold futures ended down a half percent,
"We had a handful of positive macroeconomic data points
which contributed to the better tone in markets today," said
Barry Knapp, managing director of equity research at Barclays
Capital in New York.
"But the lack of follow-through underscores that Republican
gains and an expansion of the Fed balance sheet are expected."
Republicans are poised to take control of the U.S. House of
Representatives from Democrats in Tuesday's elections, but they
are unlikely to take the Senate, the latest Reuters/Ipsos poll
shows. []
Stocks in Tokyo were poised to open lower, with the
December futures contract that trades in Chicago for the Nikkei
225 <0#NK:> off 20 points at 9,120.
The dollar's decline has slowed in recent weeks as traders
pared expectations of how aggressive the Fed might be and as
bets against the dollar swelled. []
The dollar was up 0.2 percent at 80.59 yen <JPY=>, while
the euro <EUR=> slipped 0.4 percent to $1.3882.
Oil prices rose nearly 2 percent after comments by Saudi
Arabia about consumers tolerating oil prices as high as $90 a
barrel and unease about bombs found in Greece fueled earlier
gains. []
"Consumers are looking for oil prices around $70, but
hopefully less than $90," Saudi Oil Minister Ali al-Naimi said
in comments following a speech in Singapore. "There's almost an
anchor now for the price."
Brokers and analysts interpreted the comment as signaling
the Saudis could allow prices to rise as high as $90, above the
$70-$80 range the kingdom had previously deemed satisfactory.
U.S. crude for December delivery <CLc1> rose $1.52, or 1.87
percent, to settle at $82.95 a barrel.
In London, ICE December Brent crude <LCOc1> rose $1.47 to
settle at $84.62.
Gold futures for delivery in December <GCZ0> settled down
$7 at $1,350.60 an ounce.
Trading volume on Wall Street was light and an early 1
percent rally was erased as investors took a cautious stance.
U.S. stocks have rallied, with the S&P 500 index up more
than 12 percent since the start of September in anticipation of
mid-term election and an announcement of Fed monetary easing on
Wednesday. []
The Dow Jones industrial average <> closed up 6.13
points, or 0.06 percent, at 11,124.62. The Standard & Poor's
500 Index <.SPX> rose 1.12 points, or 0.09 percent, to
1,184.38. The Nasdaq Composite Index <> fell 2.57 points,
or 0.10 percent, to 2,504.84.
U.S. Treasury prices rose in early trading and then fell,
ending the day with price losses and yield increases.
[]
Benchmark 10-year notes <US10YT=RR> traded 8/32 lower in
price to yield 2.64 percent.
(Additional reporting by Steven C. Johnson, Ryan Vlastelica
Emily Flitter, Robert Gibbons and Barani Krishnan; Writing by
Herbert Lash; Editing by Dan Grebler)
