Wall Street flat as global worries drag before earnings

NEW YORK (Reuters) - Stocks barely budged on Monday as China's weakening demand for materials and concerns over Europe's fiscal issues sapped interest before the start of earnings season.

Early buying interest waned as investors remained cautious ahead of the flow of earnings. Dow component Alcoa Inc reports its second-quarter results after the closing bell.

"I get the feeling a lot of people are on edge. They're tentative. No one really knows what to expect" with this quarter's earnings, said Paul Brigandi, a trader with Direxion Funds in New York.

Alcoa fell 0.5 percent to $10.89. Poor demand for materials could hurt Alcoa's results, as its quarterly estimate has been revised lower by 32 percent in the last month, according to StarMine reports.

The aluminum company's stock has sent mixed signals from a technical perspective of late. Alcoa is holding above its 14-day moving average, but below the 50- and 200-day averages.

The Dow Jones industrial average <.DJI> dipped 1.82 points, or 0.02 percent, to 10,196.21. The Standard & Poor's 500 Index <.SPX> inched down 1.08 points, or 0.10 percent, to 1,076.88. But the Nasdaq Composite Index <.IXIC> edged up 1.66 points, or 0.08 percent, to 2,198.11.

The S&P Materials index <.GSPM> slid 1.1 percent after Chinese data over the weekend showed the country's copper demand dropped, sending Freeport McMoRan Copper & Gold Inc down 4.3 percent at $63.17.

Energy stocks slipped, but trimmed losses along with August U.S. crude futures, which traded at $75.08 a barrel, off a session low of $74.52. But August crude was still down 1.3 percent for the day. The Standard & Poor's Energy Index <.GSPE> was down 0.2 percent.

"We're seeing a brief respite in crude selling. That's sent a lot of energy stocks up," said Tom Schrader, managing director of U.S. equity trading for Stifel Nicolaus Capital Markets in Baltimore.

U.S.-listed shares of BP Plc rose 7.7 percent to $36.68 after the British company said it plans to put a new cap on the oil leak in the Gulf of Mexico. BP's stock also got a lift from a report that BP was in talks with U.S. oil and gas company Apache Corp over potential sales of assets worth up to $10 billion.

In addition to Alcoa, other Dow components set to report earnings this week include Intel Corp , JPMorgan Chase & Co and General Electric Co .

For the second quarter, analysts see earnings growth of 27 percent for companies in the S&P 500, according to Thomson Reuters data, up from previous readings in the past three quarters, which hovered around 22 percent. This would also exceed the 22.4 percent analysts were predicting at the beginning of the year.

News that Aon Corp will buy human resources company Hewitt Associates Inc for $4.9 billion in cash and stock limited the market's decline, with Hewitt up 32.4 percent at $46.87.

Playboy Enterprises shares surged 40.4 percent to $5.53 after owner Hugh Hefner offered to take the adult entertainment company private.

Decliners outnumbered advancers by a ratio of slightly more than 2 to 1 on both the New York Stock Exchange and the Nasdaq.

(Editing by Jan Paschal)

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