Overnight Markets: US stocks gain modestly ahead of Obama’s speech

US stocks gained slightly on Tuesday, with the Dow Jones nearing a an all-time high, as investors looked forward to President Barack Obama's State of the Union address.

The Dow Jones industrial average was up 47 points, or 0.34%, at 14,019. The Standard & Poor's 500 Index gained two points, or 0.16%, at 1,519. The Nasdaq Composite Index was down six points, or 0.17%, at 3,186.

Investors are expecting Obama to give clues on an agreement with Republicans to avert automatic spending cuts due to take effect on 1 March. The White House has signalled the president will urge investment in infrastructure and clean energy, suggesting companies in those sectors may be volatile in Wednesday's session.

Gun makers could also face the heat if Obama discussed anything about gun control. Shares of Smith & Wesson declined 2 cents to $9.11 while Sturm Ruger was up 0.4% at $53.91.

Housing shares gained the most with Masco Corp jumping 12.5% after the home improvement product maker said it expects new home construction to show strong growth in 2013.

Financial shares were also up with Barclays's US-listed shares adding 9.1% after the UK bank said it would slash several thousand jobs. Bank of America rose 2.8%, JP Morgan Chase gained 1.3%.

Avon Products Inc surged 20% after the cosmetics company reversed sales declines and cut costs.

On the negative side, Coca-Cola Co declined 2.7% after reporting revenue below estimates, hurt by a weaker-than-expected performance in Europe.

Michael Kors Holdings shares rose 8.8% after the fashion company handily beat Wall Street's estimates and raised its full-year outlook.

In Asia, shares surged on Wednesday in afternoon trade as earnings from Commonwealth Bank of Australia and Leighton Holdings Ltd. boosted investor optimism.

The MSCI Asia Pacific Index gained 0.2% to 134 as of 1:07 pm in Tokyo. Japan’s Nikkei 225 Stock Average lost 1%. Australia’s S&P/ASX 200 Index gained 1%. South Korea’s Kospi Index advanced 1.4% and Singapore’s Straits Times rose 0.9%.

The markets in China and Hong Kong are closed for public holidays.