Updated from 4:17 p.m. EDT
Stocks in New York edged off their session highs but remained in the green to close Monday with gains. As investors weighed the prospects of a strengthening U.S. dollar, crude-oil prices pulled back to close below $115 a barrel.
Dow Jones Industrial Average
added 48.03 points, or 0.4%, to 11,782.35, and the
ended up 9 points, or 0.7%, at 1305.31. The
gained 25.85 points, or 1.1%, to close at 2439.95.
Crude oil lost 75 cents to end the day at $114.45 a barrel as traders kept an eye on the widening military conflict between Russia and Georgia. The average price of gasoline fell to $3.81 from $3.818, marking its 25th straight day of declines.
Marc Pado, U.S. market strategist for Cantor Fitzgerald, said that a major oil pipeline runs through Georgia. Although Georgia has claimed that Russia is targeting the pipeline but missing it, Russia would have to actually hit the pipeline to cause a supply disruption, he said.
"For oil, the bigger story is the direction of the dollar," said Pado. He said that the dollar index, which measures the dollar against a basket of foreign currencies, has broken out of a trading range between 71 and 74. "Any technician is going to look at these and say this is a turn," he said. Pado also said that recent comments from the
implying that the market has seen a high for oil prices have helped strengthen the currency.
A sustained dollar rally would also hold bullish implications for stocks by attracting foreign investment in U.S. companies, said Pado. Foreign money has stayed away from the U.S. market since 2002, he said. "The really big picture has been the dollar's decline and that's kept people away," he said. A strengthening dollar indicates a stronger U.S. economy and also adds a currency bonus to foreign investors, he said.
The dollar index was recently up 0.6% at 76.27.
Retailers and financial stocks led an upward charge earlier in the day. Dow components
Bank of America
were pulling that index higher. Home Depot jumped 4.3% to $27.51. American Express tacked on 3.6% to $39.17, and Bank of America climbed 3.5% to $33.38.
Also marking substantial gains were
, which added 4.8% to $31.61, and
, which gained 5.4% to $51.39.
Turning to the corporate side,
, another one of the 30 Dow industrials, reached new contracts with two unions and avoided a threatened strike. The company signed tentative three-year deals with the Communications Workers of America and the International Brotherhood of Electrical Workers, which together represent more than 60,000 workers. Verizon shares were up 2.1% to $35.30.
Meanwhile, several pieces of merger news were making headlines. A report from the U.K. said that package carrier
was mulling a $15 billion bid for Dutch rival TNT, but UPS subsequently downplayed the speculation. UPS stock shed 0.3% to $65.51.
Elsewhere, garbage hauler
lifted its takeover offer for
to $6.73 billion. Republic rejected an earlier proposal, and it has been planning to merge with
. Waste Management was up 0.3% at $36.11, while Republic Services ticked up 0.6% to $35.05, and Allied Waste gained 1% to $35.50.
In the technology arena,
signed a pact to buy
in a deal being valued at nearly $350 million. JDA was up 4.6% to $18.74, and i2 rose 0.4% to $14.22.
saw shares rise more than 9.4% to $88.09 after Citigroup said that it could sell 380,000 of its Kindle electronic-book-reading devices this year.
As for analyst actions, Citigroup upgraded
to buy from sell and lifted its rating on
to buy from hold. Emulex jumped 7.3% to $13.55 and Qwest soared 5.3% to $4.01.
UBS cut its estimates for 13 names in the solar sector. Among its moves,
was downgraded to neutral, while
Energy Conversion Devices
was raised to buy. SunPower added 3.2% to $75.65, and Energy Conversion Devices gained 1.9% to $64.20.
Around the globe, markets were mostly higher. Major European indices were green across the board, while in Asia, Hong Kong's Hang Seng ticked lower. After tumbling 4.5% Friday, the Shanghai Composite continued its slide, losing more than 5%.
Longer-dated Treasury securities slipped. The 10-year was down 19/32 in price, yielding 4%, and the 30-year was losing 1-6/32 to yield 4.61%. The dollar was gaining on the euro, the yen and the pound.