* McDonald's shares rise on November sales
* Investors look for progress in Washington talks
* Italian prime minister resignation adds to uncertainty
* Indexes up: S&P 0.1 pct, Dow 0.3 pct, Nasdaq 0.3 pct
By Leah Schnurr
NEW YORK, Dec 10 (Reuters) - U.S. stocks were modestly higher on Monday, helped by stronger-than-expected sales from McDonald's, but gains were constrained as investors awaited any sign of progress in talks to avert the so-called fiscal cliff.
Developments in Europe also tempered sentiment after Italian Prime Minister Mario Monti said he would resign once the 2013 budget is approved. The move added to uncertainty about reducing euro zone debt and drove Italy's borrowing costs higher.
U.S. President Barack Obama met with Republican House Speaker John Boehner on Sunday to negotiate a deal for avoiding the "fiscal cliff" that is set to go into effect in the new year.
The two sides declined to provide details about the unannounced meeting. Obama is expected to make remarks at 2 p.m. (1900 GMT) from Michigan where he is touring an auto plant.
The fiscal cliff talks have kept markets on edge in the last month as investors worry the scheduled measures could send the economy into recession if politicians do not reach a deal.
While the negotiations are at the forefront of investors' minds, most have adopted the position that a deal will be reached, even if it is at the last minute, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati, Ohio.
"We haven't had any 'progress' the last two weeks or so, yet all in all equity markets have continued to hang tough," said Detrick. "The rhetoric from Washington is strong, but Wall Street is betting something probably will get done."
The Dow was helped by a gain in McDonald's Corp. The fast food chain's stronger-than-expected November sales marked a rebound after a decline in October. The stock was up 1 percent at $89.33.
The Dow Jones industrial average gained 32.64 points, or 0.25 percent, to 13,187.77. The Standard & Poor's 500 Index added 1.09 points, or 0.08 percent, to 1,419.16. The Nasdaq Composite Index rose 9.90 points, or 0.33 percent, to 2,987.95.
Ingersoll-Rand Plc said it will spin off its security division and announced a $2 billion share buyback, sending its shares up 2.4 percent at $49.86.
Cisco Systems boosted the Nasdaq after it laid out its midterm growth strategy on Friday. Its shares were up 2 percent at $19.72.