Stocks are extending losses seen Monday as earnings week kicks off on a low note.

At 11:52 am ET, the Russell 2000 (NYSE:IWM) is down 7.3, or 1.63%, at 440.26, while the Dow is down 2.05% at 7,812.73 and the S&P 500 is down 1.75% at 820.82.

Aluminum giant Alcoa will kick off earnings season Tuesday after the close of the market. The company is expected to report a loss and set the tone for dismal results to come. Financial stocks helped push the market lower Monday, and are likely to remain under pressure in the coming days as investors brace for more losses.

But not everyone was in the red today. Small-cap restaurant chain Benihana Inc. (Nasdaq:BNHN) is up 9% after reporting an increase in total and comparable sales for Q4 and full year 2009, while First Niagara Financial Group (Nasdaq:FNFG) is up 13% on news the small cap will buy 57 branches from a unit of PNC Financial. Also rising today is biopharmaceutical company Oncothyreon Inc. (Nasdaq:ONTY), 14% higher on heavier-than-average volume.

******I sure hope SCI Daily readers bought some shares of Graham Corp. (AMEX:GHM) when I suggested it in the March 19 edition. Graham closed at $9.33 that day. Today, it’s pushing $11 a share for a 16% gain.

Graham is exactly the type of stock I love. It’s in an important sector (oil services), it has a pristine balance sheet with virtually no debt, it generates plenty of cash and it has a solid backlog.

Graham is rallying now because it is announcing new orders — $6 million worth in the last week. That may not sound like much, but when you’re doing around $100 million a year, $6 million is significant.

Among other things, Graham helps oil refiners retrofit their equipment so it can handle heavy or “sour” crude, like what comes from oil sands production. Oils sands production is more expensive than the oil we get from OPEC. Oil sands companies are break even with oil in the $50 range.

Graham hit $54 a share when oil prices were hitting their highs. Oil sands production was ramping up and refiners were investing to accommodate that supply. But when oil prices dropped, investors thought Graham’s business would drop. It has, but not as much as expected.

Now that oil prices have found some stability in the $50 range as expectations . . .

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