U.S. MARKET AVERAGES

Stocks advanced at opening after oil giant Exxon Mobil released record profits and strong consumer spending encouraged investors to bid stocks higher. However, profit taking, following two strong consecutive sessions last week limited gains. Market is expected to remain cautious ahead of Fed Reserve’s meeting Tuesday, the last to be presided over by Alan Greenspan. It is expected to raise interest rates by a quarter percentage point to 4.5%, but Wall Street expects a signal that the Fed will stop hiking rates after that.

Investors welcomed the Commerce Department's latest report on consumer spending, which rose 0.9% in December. Though personal incomes rose just 0.4%, the strong consumer spending is a sign of continued confidence in the economic growth.

Oil giant Exxon Mobil posted record quarterly profits of $10.71 billion, benefiting from high oil prices and strong demand, and beat Wall Street's forecasts by 19 cents per share. Exxon Mobil climbed $1.89 to $63.18.

Eastman Kodak Co. reported its fifth straight quarterly loss, despite 45% rise in digital products. However, the results beat Wall Street's loss forecasts.

Energy stocks stood out as the best performers in the early going with the oil service sector higher by 1.9% and the oil sector up 1.5%. Housing stocks posted significant gains in the early hours of trading. The airline sector also moved to the upside.

The health care provider and drug sectors were notable decliners in the early going. The semiconductor and computer hardware sectors showed modest decline, weighing on the technology group. The bank and defense sectors showed weakness as well.

Lowrance Electronics (LEIX: chart)was one of the biggest percentage gainers in the early going after it revealed a deal to be acquired by Simrad Yachting for $37 per share. The stock jumped 47%.

Tyson Foods (TSN: chart) stood out as one of the morning's worst performers due to disappointing Q1 earnings and a full-year forecast that missed analysts' consensus estimate. The stock dropped nearly 10%.

In the first hour of trading, the Dow Jones industrial average rose 18.17, or 0.17%. The Standard & Poor's 500 index added 1.79, or 0.14%, and the Nasdaq composite index gained 4.62, or 0.2%.

Bonds moved lower, with the yield on the 10-year Treasury note rising to 4.53% from 4.51% late Friday.

MOVERS AND SHAKERS

Lowrance Electronics (LEIX: chart), marine electronics products company, agreed to be acquired by Simrad Yachting AS for $215 million, or $37 a share which represents a premium of 48% from a closing price of $25 for Lowrance stock on Friday. The stock surged 46.5%.

USG Corp (USG: chart) agreed to resolve asbestos personal injury claims in a Chapter 11 agreement that paves the way for the company to exit bankruptcy in 2006. Berkshire Hathaway (BRKA: chart) will backstop a $1.8 billion stockholder rights offering. After voting on the plan, the plan will require approval by both the Bankruptcy Court and the district court that oversees the cases. The company also reported a Q4 net loss of $1.8 billion or $39.94 a share, compared to earnings of $85 million, or $1.98 a share in the year-ago period, citing charges. Revenue rose to $1.34 billion from $1.17 billion. USG’s shares rose 16%.

FMC Technologies (FTI: chart) raised its Q4 outlook to earnings of 7 to 17 cents a share, or 43 to 53 cents a share when excluding a tax charge for repatriating earnings. FMC added that it's near a completion of an offshore oil loading project in Algeria. Analysts expected adjusted earnings of 53 cents a share. The stock gained 6%.

ECONOMIC NEWS

Monday morning, the Department of Commerce released its report on personal income and spending in the month of December. The report showed that spending rose slightly more than expected while income rose in line with economist estimates.

The Commerce Dept. said that personal spending rose 0.9 percent in December following an upwardly revised 0.5 percent increase in November. Economists had expected spending to rise 0.8 percent compared to the 0.3 percent growth originally reported for November.

The report also showed that personal income rose 0.4 percent in December, matching the increase seen in the previous month. As mentioned above, the personal income growth came in line with economist estimates.

With personal spending outpacing personal income, personal saving as a percentage of disposable personal income was a negative 0.7 percent in December, compared with a negative 0.2 percent in November.