MARKET SNAPSHOT: Stocks Gain Ahead Of ISM Data; S&P Hits Intraday Record

By Victor Reklaitis and Sara Sjolin, MarketWatch

NEW YORK (MarketWatch) -- U.S. stocks mostly rose early Tuesday, aiming to maintain their momentum after the S&P 500 closed at a record on Friday.

Investors are awaiting data that should show healthy U.S. factory activity in August.

The S&P 500(SPX) gained 2 points, or 0.1%, to just below 2,006 after hitting an intraday record above 2,006.

Meanwhile, the Dow Jones Industrial Average(DJI) dipped 9 points, or less than 0.1%, to 17,089, and the Nasdaq Composite(RIXF) gained 13 points, or 0.3%, to 4,593.

The action comes after the S&P ended with its 32nd record close this year on Friday. It also ended the month 3.8% higher, representing the benchmark's best August performance since 2000. On Monday, the U.S. stock market was closed for the Labor Day holiday.

What strategists are saying: The S&P 500 broke above 2,000 for the first time last week, and now analysts are already talking about the next milestone. Morgan Stanley economists and equity strategists said in a note on Tuesday that "a materially higher U.S. stock market with a S&P peak near 3,000 is possible," if the U.S. recovery continues.

"The current expansion is more than five years old, and with little evidence of global synchronicity, there are no signs as yet that the global economy is overheating," they said.

Manufacturing data ahead: The data highlight on Tuesday is the Institute for Supply Management manufacturing reading, due at 10 a.m. Eastern. Economists polled by MarketWatch expect the index to come in at 56.6% in August, down from 57.1% in July, which was the strongest level since April 2011. Any reading above 50% indicates expansion.

"With bullish expectations here, any shortfall could leave traders scrabbling to lock in profits after Friday's bumper close," said Joao Monteiro, analyst at Valutrades, in a note.

Also out at 10 a.m. Eastern Time, construction spending for July is forecast to have grown by 1%, after falling 1.8% in June.

Markit's manufacturing purchasing managers' index for August is out at 9:45 a.m. Eastern.

This week's biggest economic news is expected to be Friday's jobs report. (Read more: Ahead of jobs data, U:S: economy still hitting speed bumps http://www.marketwatch.com/story/us-economy-still-hitting-speed-bumps-2014-08-31.)

Movers and shakers: Apple Inc. (AAPL) gained 0.4%, as buzz builds ahead of a Sept. 9 event for the maker of iPhones and iPads. The highly anticipated iPhone 6 and possibly the iWatch are expected to be unveiled at the event.

Dollar General Corp. (DG) added 1.1% after the discount retailer lifted its offer for rival Family Dollar Stores Inc. (FDO) to $80 a share from $78.50 a share. Family Dollar shares rose 0.7%.

Tesla Motors Inc. (TSLA) climbed 2.5%, set to add to gains from last week. On Friday, the electric-car manufacturer achieved an all-time closing high after reaching an agreement for charging stations in China.

(Read more about today's jumpiest stocks in the Movers & Shakers column http://www.marketwatch.com/story/apple-may-enter-mobile-payments-tesla-enters-china-2014-08-29.)

Other markets: Asian equities closed mainly higher, while European stocks wavered between gains and losses.

Metals prices declined across the board, while oil prices moved sharply lower as well. The dollar advanced against most major currencies. The euro (EURUSD) reached a one-year low against the dollar amid uncertainty ahead of the European Central Bank meeting on Thursday.

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