NEW YORK (

TheStreet

) -- Stocks closed on a mixed note on Monday as investors turned cautious ahead of tomorrow's midterm elections and the

Federal Reserve's

expected announcement of additional quantitative easing measures later this week.

The

Dow Jones Industrial Average

finished modestly higher by 6 points, or 0.06%, to 11,124. The

S&P 500

was up by a point at1184 and the

Nasdaq

was down by 2 points, or 0.1%, at 2504.

Utilities and consumer cyclicals were a drag on the markets, offsetting gains in energy stocks.

DuPont

(DD) - Get Report

,

Kraft Foods

( KFT) and

Chevron

(CVX) - Get Report

exerted the most pressure on the Dow, while

Intel

(INTC) - Get Report

,

Hewlett Packard

(HPQ) - Get Report

and

Pfizer

(PFE) - Get Report

showed the strongest gains.

Earlier in the day, stocks gained more than 100 points over the previous day's session after that

strong manufacturing data from China and India and a rebound in U.S. manufacturing and construction spending in October aided sentiment.

Overseas, Hong Kong's Hang Seng surged 2.4% while Japan's Nikkei inched 0.5% lower. The FTSE in London increased 0.3% while the DAX in Frankfurt closed relatively unchanged.

Investors are looking ahead to a busy week with midterm elections scheduled for Tuesday and the conclusion of the Fed's policy-setting meeting on Wednesday afternoon. The market has been expecting the Fed to announce additional quantitative easing measures since late August but there is still a lot of uncertainty regarding the scope of the second stimulus.

"Profits are doing well but what the market is looking for is a little certainty and some guidance. They're waiting to see what the Fed is going to do and what's happening in Washington," said Scott Rostan, founder and principal at Training The Street. "If Republicans do take control of the House, that probably means the temporary extension of the Bush tax cuts, which will be a short-term positive for the market. But you still have to address the longer-term issues of unemployment and the deficit. I do think a Republican takeover of the House is already priced in into the market, so you probably won't see a short-term pop on a House takeover but if there's a Republican takeover of the Senate, you might see a pop."

"The Fed has to play their hand wisely because they don't want to send the wrong message with too much stimulus because that could suggest that the market is much weaker than people thought. But if they don't make it large enough, then people will doubt whether it will make any difference. So I think the Fed does need to do a Goldilocks here: not too much but not too little."

U.S.

personal income unexpectedly fell in September, dropping 0.1% after rising 0.4% in August, according to the Bureau of Economic Analysis. Personal spending rose 0.2%, compared with growth of 0.5% in the prior month. Economists had anticipated a 0.3% increase in income and a 0.4% uptick in spending, according to Briefing.com.

The

Institute for Supply Management's October manufacturing index jumped to 56.9 after hitting 54.4 in September. The level exceeded expectations for a reading of 53.6, according to Briefing.com.

In a note on the morning's data, PNC Chief Economist Stuart Hoffman said weaker-than-expected personal income was consistent with September's weak labor market. "September payroll employment fell by 95,000 as the last big slug of temporary census workers were let go and local governments also shed employees," he said.

"The ISM Manufacturing Index for October firmed up to 56.9%, boosted by strong orders, increased production and export gains," he said, adding that the new orders sub-index jumped 7.8% during the month, the production index rose 6.2% and the exports index increased 6% on a weaker dollar.

The Department of Commerce said construction spending rose 0.5% in September, outpacing projections for a decline of 0.5%, according to Briefing.com. The monthly growth compares to a drop of 0.2% in August.

Shares of

MEMC Electronics

(WFR)

sank 9% in extended trading after its quarterly results fell short of Wall Street expectations. The company reported an adjusted profit of 10 cents per share vs. the average analysts' estimate of 13 cents and also suspended its guidance.

Anadarko Petroleum

(APC) - Get Report

dropped 1.5% in aftermarket hours after it reported third-quarter adjusted earnings of $103 million, or 21 cents a share, coming in 7 cents below the consensus view.

Shares of network security company

Fortinet

(FTNT) - Get Report

jumped 6.3% to $31.88 on speculation spurred by a

Bloomberg

report about a potential takeover by

IBM

(IBM) - Get Report

.

M&T Bank

(MTB) - Get Report

agreed to acquire

Wilmington Trust

( WL) in a stock-for-stock transaction valued at $351 million. Shares of M&T advanced 3.6% to $77.47 while Wilmington's stock crashed 40% to $4.21.

Shares of

Ambac Financial Group

( ABK)sank 50% to 41 cents a share after the company revealed in a regulatory filing that it's in talks with senior creditors to file a prepackaged bankruptcy.

Baker Hughes

(BHI)

blew past estimates with third-quarter earnings of 59 cents a share on sales of $4.08 billion. Analysts, on average, had been expecting a profit of 47 cents a share on sales of $3.8 billion. The stock gained 4.2% to $48.37.

Humana

(HUM) - Get Report

reported third-quarter earnings of $2.32 a share, which includes gains of 31 cents a share. Sales rose 9% to $8.42 billion, and the company increased its full-year earnings forecast to $6.40 to $6.50 a share. Wall Street had projected third-quarter earnings of $1.66 a share and full-year earnings of $6.42 a share. Shares traded 0.6% higher at $58.68.

McKesson

(MCK) - Get Report

said it will buy cancer treatment company

U.S. Oncology

for roughly $2.16 billion. McKesson added 2.8% to $67.88.

EXCO Resources

(XCO)

said Chairman and CEO Douglas Miller proposed to buy all outstanding shares of the company that he doesn't already own for $20.50 a share -- a 38% premium to its Friday closing price. Shares jumped 30% to $19.30.

AIG

(AIG) - Get Report

said it will repay $37 billion in bailout funds now that it has divested two large subsidiaries. AIG closed the sale of Alico to

MetLife

(MET) - Get Report

for $16.2 billion on Monday and earlier in the month, the company raised $20.5 billion through its AIA Group offering on the

Hong Kong Stock Exchange

. AIG's stock inched 0.1% lower to $41.92.

CNA Surety

( SUR) jumped 20% to $23.15 after CNA Financial said it will buy the remaining stake in the company for $22 a piece.

Jinko Solar

(JKS) - Get Report

soared 17% to $35.14 after it reported strong results and raised its outlook.

Seattle Genetics

(SGEN) - Get Report

fell 4.7% to $15.63 after Brean Murray downgraded the stock.

In commodity markets, the December crude oil contract added $1.52 to settle at $82.95 a barrel. Meanwhile, the December gold contract shed $7 to settle at $1,350.6 an ounce.

The dollar traded higher against a basket of currencies, with the dollar index up by 0.3%, and the benchmark 10-year Treasury note weakened 10/32, lifting the yield to 2.639%.

--Written by Melinda Peer and Shanthi Venkataraman in New York

.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.