Edging Up Before Earnings

Nevertheless, the Dow Jones Industrial Average gained 0.2% Monday to close at 12,423.49, while the S&P 500 closed up 0.2% at 1412.84. The Nasdaq Composite added just 0.16% to close at 2438.20.

Tech, M&A Pace Gains

Expectations for the technology sector are still running high as analysts upgraded more companies Monday and the Consumer Electronics Show takes over Las Vegas. Shares of IBM(IBM Quote), EMC(EMC Quote) and Network Appliance(NTAP Quote) rose between 1.5% to 3% on news of an upgrade by UBS.

The semiconductor sector likewise fared well Monday with the Semiconductor HOLDRs(SMH Quote) exchange-traded fund and the Philadelphia Semiconductors Sector Index each up 0.6%.

On the flip side, Tellabs (TLAB Quote) tumbled 4.4% and Molex (MOLX Quote) shed 4.9% after each gave weaker-than-expected guidance.

Shares of Wal-Mart(WMT Quote) were punished by a Goldman Sachs downgrade to neutral. Shares fell 0.8%, while those of struggling apparel retailer Gap Stores(GPS Quote) surged 7.3% on sale rumors.

Indeed, another wave of M&A activity helped keep the stock market afloat Monday. Shares of Forest Oil(FST Quote) slipped 3.5% on news that the company will buy Houston Exploration(THX Quote) for $1.5 billion, but Houston Exploration's shares rose 4.1%.

General Electric(GE Quote) shares slipped a fraction as the company said it will buy Houston-based oil and gas equipment company Vetco Gray.

Elsewhere, shares of United Surgical Partners(USPI Quote) jumped 11.7% on news it agreed to be bought by a private equity group at a 13% premium to Friday's closing stock price. Competitor Symbion (SMBI Quote) rose 5.9% in concert.

Finally, Advanced Medical Optics (EYE Quote) rose 4.8% on news it has agreed to acquire fellow laser vision-correction company IntraLase (ILSE Quote) for $808 million; IntraLase jumped 10.3%.