NEW YORK – Stocks remained essentially flat Monday as investors collected profits from last week's run-up and digested a mixed bag of news, including a drop in crude prices and Wrigley's $1.5 billion bid for several candy brands from Kraft Foods.
The Dow Jones Industrial Average (search) ended up 11.23 points, or 0.11 percent, at 10,550.24 and the Standard & Poor's 500 index (search) closed down 0.36 points, or 0.03 percent, at 1,183.81. The Nasdaq Composite Index (search) finished up 8.75 points, or 0.42 percent, at 2,094.09.
For November, the Dow is up 5 percent, while the Nasdaq is up nearly 6 percent, and the S&P is up almost 5 percent.
The pullback in energy prices and the pickup of mergers and acquisitions activity was encouraging to analysts, who were not distressed by the day's lackluster trading.
After three solid weeks of gains, and in the absence of any new economic data, it's natural for investors to take a step back and book some profits.
"It's very important that the market didn't give back a good chunk of the recent gains back right away," Marc Pado, U.S. market strategist from Cantor Fitzgerald & Co., said. "Everyone expects a little profit-taking, consolidation and sector rotation but you don't want turnaround and give back 50 percent of the gains you saw on Friday. And we're still seeing solid leadership from technology stocks."
Oil prices dropped, continuing a three-week trend that has taken crude futures down from their record $55-per-barrel level. Light, sweet crude for December delivery shed 52 cents to $46.87 on the New York Mercantile Exchange (search).
Software maker Microsoft (MSFT), a component of the Dow and tech-dominated Nasdaq, was up 42 cents at $27.39 as Wall Street adjusted its price to reflect the company's special $3 dividend, payable Dec. 3. While the stock has gone up since the dividend was announced in July, the company still faces questions about profit growth and a dearth of large software launches in the coming year.
Dow component AIG (AIG) is close to completing a deal with U.S. regulators to resolve an investigation into whether it helped PNC Financial Services Group Inc. with accounting fraud, The Wall Street Journal reported. The insurer's shares rose about 3 percent, or $1.81, to $62.84 on the NYSE.
"AIG seems to be helping the Dow and oil is down a little more today," said John O'Donoghue, CSFB managing director of listed trading. "As energy gyrates around here, you will see more emotional trading in oil and oil services stocks."
Investors were also weighing the resignations of four members of President Bush's cabinet following the election, including Secretary of State Colin Powell (search) and Energy Secretary Spencer Abraham (search). Including the latest resignations, six members of the president's 15-member Cabinet have announced plans to step down for his second term.
The day's news seemed to have little impact on trading, as institutional investors focused on technical levels after equities jumped 8 percent over the last three weeks. Still analysts noted that the market is entering a seasonally strong period, which may help keep stocks aloft through the end of the year.
"We're due to kind of settle in on a short-term basis," said Steven Goldman, chief market strategist at Weeden & Co. in Greenwich, Conn. "Three weeks ago we were at the lower end of the move over the past year and now we're at the upper end. So we've completed the lows to the highs in a matter of three weeks. But historically it's a lot easier to get a market going this time of year."
General Electric Co. (GE) fell 15 cents to $36.10 after announcing plans to buy SPX Corp.'s Edwards Systems Technology fire-and-security unit for nearly $1.4 billion in an all-cash deal, both companies said Monday. SPX Corp. (SPW) rose $1.22, or 2.8 percent, to $44.21, on the news.
Wrigley (WWY) added 72 cents to $68.08 after the candy and gum maker announced an agreement to buy several brands, including Life Savers and Altoids, from Kraft for $1.48 billion. Kraft declined 20 cents to $34.68.
Dow Jones & Co. (DJ), publisher of The Wall Street Journal, added 10 cents to $45.10 after announcing plans to buy MarketWatch Inc. for about $519 million in a deal that would end a monthlong bidding war for the online financial news and information provider. MarketWatch, which operates two Web sites, CBS.MarketWatch.com and BigCharts.com, closed up $1.33, or 7.9 percent, at $18.12.
Lowe's Cos. Inc (LOW) was down $1.00, or 1.7 percent, at $59.25, despite reporting a 15.5 percent rise in third-quarter earnings, and offering a bullish forecast. Its results beat Wall Street expectations by 6 cents a share.
Trading was active, with 1.4 billion shares changing hands on the New York Stock Exchange, equal to the 1.4 billion daily average for last year. About 1.9 billion shares were traded on Nasdaq, above the 1.69 billion daily average last year.
More than one stock rose for every one that declined on both the NYSE and Nasdaq.
The Russell 2000 index, which tracks smaller company stocks, was up 1.88, or 0.30 percent, at 623.86.
Overseas, Japan's Nikkei stock average surged 1.88 percent. In Europe, France's CAC-40 lost 0.37 percent, Britain's FTSE 100 added 0.19
Reuters and the Associated Press contributed to this report.