Updated from 4:11 p.m. EST

Stocks finished moderately higher Monday, with tech outperforming the broader market, but early investor enthusiasm for a wave of mergers steadily dissipated.

The

Dow Jones Industrial Average

rose 17.07 points, or 0.16%, to 10,621.03; the

S&P 500

gained 4.06 points, or 0.34%, to 1190.25; and the

Nasdaq

gained 8.43 points, or 0.40%, to 2097.04. Earlier in the session, the Dow held a 50-point gain, and the S&P 500 rose above the 1200 level. The 10-year Treasury note fell 1/32 in price to yield 4.27%, while the dollar was weaker against the yen and euro after six sessions of gains.

"You might have seen some profit-taking before the economic data coming later this week," said Brian Williamson, an equity trader with Boston Company Asset Management. "It may also have been some jitters before some of the earnings reports."

Volume on the

NYSE

was 1.49 billion shares, with advancers beating decliners by a ratio of 7 to 4. On the Nasdaq, 2.10 billion shares changed hands, with advancers outpacing decliners 17 to 14.

The February crude contract closed down 10 cents to $45.33, even after

Royal Dutch

(RD)

and

Shell Group

(SC) - Get Report

halted North Sea output for a fourth straight day. Crude topped $47 a barrel earlier in the session for a six-week high.

In economic news, a Commerce Department report showed U.S. wholesaler inventories increased 1.1% last month, outpacing a 0.7% increase in sales. Economists had expected a 0.9% increase in inventories.

"Growing inventories can actually show an increase in demand for products, so that's a little bit of a positive," said Robert Pavlik, a portfolio manager with Oaktree Asset Management. "Today's number, while usually not heavily emphasized, helped the market jump a bit."

Among companies,

Alltel

(AT) - Get Report

agreed to acquire

Western Wireless

(WWCA)

for cash, stock and assumed debt that comes out to about $6 billion. Little Rock, Ark.-based Alltel will pick up about 1.4 million subscribers in 19 states. Alltel fell $1.37, or 2.4%, to $54.75, while shares of Western Wireless were up 85 cents, or 2.3%, to $37.37.

In another big deal, Rupert Murdoch's

News Corp.

(NWS) - Get Report

will buy out shareholders of its publicly traded

Fox Entertainment

(FOX) - Get Report

unit for $7 billion. Shares of Fox rose $3.06, or 9.8%, to $34.28.

Movie Gallery

(MOVI)

announced a definitive agreement to acquire

Hollywood Video

(HLYW)

for $13.25 a share, or $850 million in cash, plus the assumption of $350 million in debt. The bid represents a 15% premium over a previous offer from

Blockbuster

(BBI) - Get Report

. Hollywood shares were up 81 cents, or 6.2%, to $13.86.

"Since all the M&A news happened overnight and early this morning, it gave the market a pop and kept it on the upside," said Jay Suskind, head of institutional equity trading with Ryan Beck & Co. "The market wonders if there's more to come. Overall, there was no bad news today, and now we're looking ahead at earnings with cautious optimism."

UBS raised its earnings and sales estimates on

IBM

(IBM) - Get Report

, citing brisk corporate demand. The brokerage expects IBM to earn $1.78 a share on sales of $27.8 billion in the fourth quarter, up from its previous estimate of $1.74 a share on $27.5 billion in sales. UBS cited specific strength in hardware and consulting. IBM was off 10 cents, or 0.1%, to $95.68.

Wal-Mart

(WMT) - Get Report

confirmed over the weekend that it expects U.S. same-store sales in January to match its previous forecast of an increase between 2% and 4%. Wal-Mart lost 27 cents, or 0.5%, to $53.72.

General Motors

(GM) - Get Report

CEO Rick Wagoner said health care costs could top $5 billion this year, creating "headwinds" for the world's biggest automaker. In an interview with

The Wall Street Journal

, Wagoner refused to affirm GM's goal of earning $10 a share by next year. GM was lower by 51 cents, or 1.3%, to $38.49.

American Pharmaceutical Partners

(APPX)

and

American Bioscience

said the Food and Drug Administration has approved their drug Abraxane for injectable suspension in metastatic breast cancer. American Pharma shares soared $11.01, or 28.4%, to $49.72.

CSFB upgraded

Nokia

(NOK) - Get Report

to outperform from neutral, saying the Finnish firm should be able to raise its share of an expanding market in 2005 and 2006. Nokia, which was also upgraded by J.P. Morgan, rose 24 cents, or 1.6%, to $15.49.

Advanced Micro Devices

(AMD) - Get Report

was upgraded by UBS to neutral from reduce. The firm said it believes AMD is now priced at fair valuation but that it will be increasingly difficult for AMD to differentiate its products from

Intel's

(INTC) - Get Report

. AMD finished up 21 cents, or 1%, to $20.13.

Comcast

(CMCSA) - Get Report

will outline a plan Monday to move into the telephone business, similar to steps taken by

Time Warner

(TWX)

and

Cox Communications

(COX)

. Comcast's plan is expected to be the most ambitious to date and would increase pressure on competitors while escalating a battle for market share. Comcast rose 66 cents, or 2%, to $33.23.

Later this week,

Apple

(AAPL) - Get Report

,

Intel

(INTC) - Get Report

and

Sun Microsystems

(SUNW) - Get Report

will all release fourth-quarter earnings reports.

Overseas markets finished lower, with London's FTSE 100 down 0.3% to 4840 and Germany's Xetra DAX falling 0.2% to 4307. In Asia, Japan's Nikkei fell 0.5% overnight to 11,433, while Hong Kong's Hang Seng lost 1% to 13,575.