Updated with final closing numbers, corrects the length of the Nasdaq's winning streak.
NEW YORK (
) -- Stocks trimmed gains in the final hour of trading to finish on a mixed note on Monday as strength in commodity stocks was offset by weakness in tech stocks.
Dow Jones Industrial Average
rose 18 points, or 0.2%, to 11,428, a disappointing close after it rose as high as 11,480 earlier in the session. Still, the blue-chip index did manage to settle at its highest level since Nov. 5. The
finished flat at 1,240, while the
snapped its eight-day winning streak, shedding 12 points, or 0.5% in the final hour to close at 2,624, after trading positive for most of the session.
led the Dow higher, while
Bank of America
Tuesday's action could take its cue from evolving events on Capitol Hill as the Senate began a procedural vote late in the day on President Obama's tax-cut deal with Congressional Republicans. By the latest count, the Senate had met the threshold of 60 votes needed to schedule a final vote on the legislation, which will extend tax cuts across the board for an additional two years and extend expanded unemployment insurance benefits.
The bill's fate in the House remains uncertain. House Democrats have signaled that they intend to increase the estate tax rate from the agreement's level of 35%.
"The tax package, taken in total, amounts to another round of fiscal stimulus for the U.S. economy and bolsters our forecast for transition to a self-sustaining 'half-speed' economic and job market expansion through 2011," said PNC Chief Economist Stuart Hoffman in a recent note. Hoffman added that the tax extension wasn't likely to shorten the Fed's plan to buy $600 billion of Treasury securities but does make the prospect of additional Fed easing measures unlikely.
monthly policy meeting will be held on Tuesday. Few analysts expect the central bank to make any big announcements in the final month of the year. Investors will, however, continue to watch out for language from the Fed that could hint at further action on quantitative easing.
Stocks started on a strong note on Monday on news that China refrained from raising interest rates even though inflation jumped to a 28-month high of 5.1%. Buying was still selective, with 57% of the stocks traded on the NYSE moving higher, while 41% declined. Basic materials and energy-related companies surged on the China rate inaction, supported by a weaker dollar.
Copper gained, with the March contract rising 9 cents to settle at $4.21.
Freeport-McMoRan Copper & Gold
gained more than 2% each.
surged higher by 1% each.
The January crude oil contract jumped 82 cents to settle at $88.61 a barrel after the Organization of Petroleum Exporting Countries kept production caps in place despite an improved economic outlook. The most actively traded February gold contract traded $13.10 higher to settle at $1,398 an ounce.
Darin Newsom, senior commodities analyst at DTN Securities, said that the day's moves in commodities were being governed by the weakness in the dollar resulting from China's decision. "The dollar and the yuan are closely linked. Had China increased interest rates, it would have strengthened the yuan and the dollar would have followed because those two are tied together," says Newsom. He went on to add that investors would continue to closely monitor any talk about overheating or a hard landing in China, as demand from the giant continues to drive commodity prices.
In deals news,
offered to buy
, a U.K.-based maker of oil and gas pipeline products, for 800 million pounds, or $1.3 billion. GE's stock fell 0.5% to $17.62.
Thermo Fisher Scientific
agreed to buy
, a maker of products used by industrial, research and laboratory markets, for $118.50 per share in cash, or $2.1 billion. Dionex's stock soared 20% to $117.83 and Thermo Fisher's stock jumped 4.8% to $55.56.
After upping its bid for data storage company
by 25 cents per share,
signed an acquisition agreement with the company worth $960 million, or $820 million excluding the cash on Compellent's books. Dell's stock dropped 3.8% to $13.35 and Compellent's stock was off by 2.5% at $27.98.
In other equities news,
Monday will likely be the busiest day in the company's history as it expects to move 16 million global shipments -- or 13% more than its busiest day in 2009. FedEx shares inched up 0.3% to $94.31 while shares of rival
slid 0.2% to $72.77.
gained 0.8% to $17.90 on news that it
intends to pay a quarterly dividend of 15 cents a share. The first payment is slated for March 2011.
shed 2.6% to $6.66 after it announced
plans to repay the government's Troubled Asset Relief Program by raising $920 million through a common stock offering and, at a future date, raising $300 million through a debt offering of subordinated notes.
shot up 3.2% to $14 after Piper Jaffray analyst raised his rating on the optical networking equipment company to overweight from neutral
Great Atlantic & Pacific Tea
filed for Chapter 11 bankruptcy protection on Sunday, listing debts of more than $3.2 billion and assets of roughly $2.5 billion in its bankruptcy court petition.
There were no economic releases scheduled during Monday's session.
The benchmark 10-year Treasury note strengthened 17/32, diluting the yield to 3.258%.
China's decision to maintain interest rates also helped to push global markets higher. Hong Kong's Hang Seng added 0.7% and Japan's Nikkei gained 0.8%. The FTSE in London advanced by 0.8% and the DAX in Frankfurt ticked 0.3% higher.
-- Written by Melinda Peer and Shanthi Bharatwaj in New York
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.