MARKET SNAPSHOT: U.S. Stocks: S&P 500's Record Highs May Be Put To The Test

By Anora Mahmudova and Barbara Kollmeyer, MarketWatch

NEW YORK (MarketWatch) -- The U.S. stock market began the week on a cautious note, as prices on the main benchmarks opened mostly unchanged on Monday.

With the economic calendar looking thin, investors are focusing on the benchmarks' record levels, as well as volatile commodity prices.

The S&P 500 (SPX) and Dow Jones Industrial Average (DJI) were hovering near record closing levels. The Nasdaq Composite (RIXF) also was mostly flat.

Need to Know: Stocks overvalued by 100% or a new secular bull market?

Bank of America Merrill Lynch said in a note Friday that risk assets should move higher in the short term as central-bank policies and data cause investors to reduce cash going into the year-end. But, watch gold closely, said Michael Hartnett, the investment bank's chief investment strategist.

"A sudden gap lower in the gold prices to below $1,000/oz should coincide with the final thrust higher in stocks, both indicating capitulation of the 'stubborn bears', the end of the 'melt-up and the next opportunity to get tactically bearish," said Hartnett.

Gold prices (GCZ4) hovered around $1,164 an ounce on Monday. Oil (CLZ4) prices rose amid reports of renewed fighting in eastern Ukraine, but trimmed earlier gains. WTI Crude was up 0.6%, and Brent oil was up 1%, after being up as much as 2%.

Stocks to watch: Dendreon Corp.'s (DNDN) shares plunged on Monday after reports indicated that the cancer-treatment maker announced it filed for Chapter 11 bankruptcy.

Rackspace Hosting Inc.(RAX) reports on Monday, along with Sotheby's(BID). See Movers & Shakers

General Motors Co.(GM.XX) shares were lower after The Wall Street Journal reported the auto maker ordered a half-million replacement ignition switches to fix Chevrolet Cobalts and other small cars nearly two months before it let federal safety regulators know there was a problem.

GoPro's stock (GPRO) slumped after the maker of wearable video cameras announced plans to sell $800 million shares of Class A common stock to the public.

Investors will be looking to see if retailers are benefiting from record levels of consumer sentiment and confidence this week. Retail sales data is due Friday and ahead of that plenty of individual companies will report, among them Wal-Mart Stores Inc.(WMT) on Thursday. See: Retail earnings to test those consumer sentiment highs

Hong Kong stocks rally on Stock Connect: A bright spot across global markets Monday was in Hong Kong, where the Hang Seng rose 0.8% after regulators said the Stock Connect program, which allows individual investors outside of China to buy Shanghai-listed shares for the first time ever, will start Nov. 17.

A batch of Chinese economic data showed in-line inflation and export growth that slowed from a year earlier, though it beat forecasts.

Europe stocks edged higher, while the dollar(DXY) pulled back from recent gains in the wake of U.S. jobs data.

Subscribe to WSJ: http://online.wsj.com?mod=djnwires