Here's Why the S&P 500 Headed Modestly Higher

All eyes are on Ben Bernanke and the Federal Reserve, which is set to meet later this week to determine whether further stimulus is needed to jumpstart the U.S. economy. In addition, a German court is set to rule Wednesday on whether Germany can participate in the European bailout fund. Ahead of these two key events, the S&P 500 (INDEX: ^GSPC) ended up a modest 4.48 points (0.31%) to 1,433.56. Let's have a look at some of the stocks giving the S&P 500 a boost and a few notable exceptions to today's bullishness.

Companies that helped the S&P 500
Chipmaker Advanced Micro Devices (NYS: AMD) reversed last week's tumble to gain 8% to the upside after announcing an investment in cloud-based video-game technology company CiiNow. Although the amount of the investment is unknown at this time, it signals AMD's proactive stance toward placing itself at the heart of corporate cloud spending. According to Cisco Systems' estimates, cloud spending could reach $241 billion by 2020, so this may wind up being a lucrative investment for AMD.

Oil and natural gas provider Cabot Oil & Gas (NYS: COG) has been a notable outperformer as well, ending up almost 6%. Between rising oil prices that are back over $97 a barrel, and a timely upgrade from Stifel Nicolaus yesterday to "buy" from "hold," things are looking up for Cabot, both literally and metaphorically. Stifel believes that Cabot's Marcellus Shale volume will be higher in the latter half of 2012 and set a price target on the company of $55 -- a clean 25% higher than where it's currently trading.

Companies that are hindering the S&P 500
However, not every company was participating in today's modest rally. Brand-name apparel company Polo Ralph Lauren (NYS: RL) fell out of fashion right from the get-go this morning, following a sizable drop from Burberry in overseas markets. Shares of Ralph Lauren finished down 2.6%. Burberry's earnings warning is the latest in a string of higher-end retailers that have seen spending conditions weaken -- specifically in Europe. There have been a few exceptions to the rule (e.g., Michael Kors), but everything considered, luxury retailers are on shaky ground at the moment.

Another company flying onto investors' radars in a bad way today was Southwest Airlines (NYS: LUV) -- and not for the reason you'd suspect. A glitch in Sabre Holdings' reservation software made it practically impossible for consumers to book flights with Southwest and American Airlines Tuesday morning. Although the outage lasted only 45 minutes and the problem has been fixed, shareholders, as is common with the airline sector, seem to be in an unforgiving mood. Southwest shares shed 2% on the day.

Take it to the register
If Burberry's earnings warning has you down, then we have just the cure with our latest special report highlighting three stocks that will rule retail for years to come. This report is free and packed with three winners unlikely to go out of fashion. Get your copy.

The article Here's Why the S&P 500 Headed Modestly Higher originally appeared on

Fool contributorSean Williamshas no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen nameTMFUltraLong, track every pick he makes under the screen nameTrackUltraLong, and check him out on Twitter, where he goes by the handle@TMFUltraLong.The Motley Fool owns shares of Cisco Systems.Motley Fool newsletter serviceshave recommended buying shares of Southwest Airlines. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.