By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market reversed opening
losses and edged higher on Monday as upbeat economic reports and
deal news outweighed concerns about violence in Iraq.
Better-than-expected manufacturing reports and housing data as
well as a flurry of deal news lifted the main benchmarks out of
opening losses. Limiting gains were concerns about a worsening
situation in Iraq. Over the weekend, militants in Iraq tweeted out
images supporting a claim they had executed hundreds of Shiite
Iraqi soldiers. The killings were not verified, according to
reports.
The S&P 500 (SPX) added 3 points, or 0.2%, to 1,939.04. The
Nasdaq Composite (RIXF) rose 8 points, or 0.2%, to 4,318.71, helped
by a 1% gain in Apple Inc. (AAPL), its biggest component.
The Dow Jones Industrial Average (DJI) ticked up 6 points to
16,782.04.
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action.
Terry Sandven, chief equity strategist at U.S. Bank Wealth
Management, said that given the recent gains on the S&P 500,
stocks are in pause mode.
"From the technicals standpoint, markets are slightly extended
and until the earnings season we expect stocks to trade sideways
with the downward bias," Sandven said.
Fresh data from the factory sector showed that manufacturing
remained a bright spot in the U.S. economy at the end of the second
quarter.
Manufacturing activity in the New York region held steady in
June after hitting an almost four-year high in May, the Federal
Reserve Bank of New York said Monday.
Industrial production bounced back in May after a drop in April
that wasn't as bad as initially estimated.
Home builders' confidence rose in June to the highest level in
five months, but respondents were still a bit pessimistic,
according to the National Association of Home Builders/Wells Fargo
housing-market index released Monday.
Merger Monday
Medtronic Inc. (MDT) announced Sunday that it plans to buy
Ireland-based Covidien PLC (COV) in a $42.9 billion deal. The
cash-and-stock offer would be valued at $93.22 per Covidien share.
Shares of Covidien soared 22%, while Medtronic fell 1%. Medtronic,
big health companies look to dodge U.S. taxes
Shares of Bluebird Bio Inc. (BLUE) soared 41% after the company
reported promising preliminary data on experimental gene therapy
for patients with inherited blood disorders.
Level 3 Communications Inc. (LVLT) shares dropped 6% after the
company said Monday it agreed to acquire TW Telecom Inc. (TWTC) in
a deal worth about $7.3 billion, including the assumption of $1.6
billion in debt. Level 3 said it secured committed financing valued
at $3 billion.
TW Telecom shares increased 7%.
Fusion-io Inc. (FIO) shares surged 23% after SanDisk Corp.
(SNDK) on Monday agreed to buy Fusion-io in an , or $11.25 a
share.
Yahoo Inc. (YHOO) dropped 5% after Chinese Internet company
Alibaba reported slowing revenue growth for the year. Yahoo owns
24% of Alibaba.
In other markets, European stocks fell after a weekend of
increasing violence in Iraq. Japanese stocks fell in a mixed
session for Asia as Iraq worries pushed the Japanese yen (USDJPY)
higher against the dollar.
The British pound tapped $1.70 against the dollar and traded at
a nearly five-year high on speculation the Bank of England could be
one of the first major central banks to break away from ultra-easy
monetary policy.
Oil prices (CLN4) pulled back from stronger, earlier gains,
while gold(GCQ4) was higher.
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