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Stocks Get Lift From Health Care

Stocks finish higher Monday, buoyed by blue-chip upgrades, deal news and health care stocks.
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NEW YORK (

TheStreet

) -- Stocks closed solidly higher Monday, buoyed by blue-chip upgrades, deal news and a surging health care sector.

The

Dow Jones Industrial Average

finished up 85 points, or 0.8%, to 10,414. The

S&P 500

rose 12 points, or 1.1%, to 1114, while the

Nasdaq

added 26 points, or 1.2%, to 2238.

Shares of

Intel

(INTC) - Get Report

and

Alcoa

(AA) - Get Report

surged 2.3% and 7.9%, respectively, after

receiving analysts' upgrades this morning. A

Reuters

report also said Alcoa will be teaming with

Saudi Arabian Mining (Ma'aden)

to build

an aluminum facility for $10.8 billion.

>>See Five Cheap Small-Cap Stocks

Elsewhere, Goldman Sachs added

Potash

(POT)

to its conviction buy list, while upgrading

Mosaic

(MOS) - Get Report

to buy from neutral. Shares rose 3.5% and 5.6%, respectively, today.

Light trading volumes are expected during this holiday-shortened week. The market will close at 1 p.m. Thursday for Christmas Eve and will be closed on Friday for Christmas.

Deal news helped boost the market today. Mining-equipment maker

Bucyrus

(BUCY)

will buy

Terex's

(TEX) - Get Report

mining unit for $1.3 billion, while

Sanofi-Aventis

(SNY) - Get Report

agreed to purchase

Chattem

(CHTT)

for $1.9 billion. Bucyrus and Terex shares added 9.8% and 9%, respectively, while Chattem soared 33.1%.

TreeHouse Foods

(THS) - Get Report

shares rose 12.3% after it announced plans to buy

TheStreet Recommends

Sturm Foods

for $660 million.

Elsewhere, the U.S. Senate overcame an initial procedural hurdle,

voting 60-40 early this morning

to push ahead on major health care reform legislation. A final vote in the Senate is expected on Dec. 24. If passed, the bill must be reconciled with a House version.

Health insurers rallied broadly Monday, powered by the forthcoming legislation that would mandate health insurance for all, though with no public option.

Cigna

(CI) - Get Report

,

Aetna

(AET)

and

Humana

(HUM) - Get Report

rose 3.9%, 4.7% and 3.5%, respectively.

Paul Nolte, managing director at Dearborn Partners, said that Monday's stock jump "may be just the Christmas rally," aided in part by the takeover news and health care legislation. Considering the lack of economic news on Monday, he also said to keep an eye on certain economic statistics later this week.

"Housing data ... may provide some boost if we see better activity," Nolte wrote in an email. "So far, activity in the housing market (using MBA and NAHB data) remains muted, even with low mortgage rates."

Along with housing figures, data on spending, consumer sentiment, durable goods and unemployment claims are expected throughout the week. A final read on third-quarter U.S. gross domestic product is due on Tuesday.

The greenback advanced Monday, with the Dollar Index up 0.4%. The buck's rise put pressure on commodities, as the February gold contract slid $15.50 to settle at $1,096 an ounce.

Crude oil for February delivery settled 70 cents lower to $73.72 a barrel. The January contract will expire at the end of Monday's session. The Organization of the Petroleum Exporting Countries is set to meet on Tuesday. Many expect the oil ministers to maintain current output levels.

The yield curve between two-year and 10-year Treasury notes widened to a record spread today on further growth expectations. The 10-year note was recently down 1 4/32, as the yield rose to 3.68%. The two-year note was 5/32 lower to yield 0.87%.

Only a few earnings reports will trickle in this week; one of those was

Walgreen

(WAG)

, which reported a

first-quarter profit beat on strong drug sales before Monday's opening bell. Shares finished 3 cents lower at $36.61.

ConAgra Foods

(CAG) - Get Report

said it surpassed profit targets this morning, earning an adjusted 52 cents a share during the second quarter. Sales finished slightly below expectations at $3.17 billion, though the maker of such ubiquitous food brands as Chef Boyardee and Kid Cuisine also raised its 2010 guidance. Shares shed 1.5% to $21.83.

Jabil Circuit

(JBL) - Get Report

swung to a profit in the first-quarter and bested forecasts in posting adjusted earnings of 32 cents a share after the closing bell. Shares were bid higher by another 3.6% in the extended session.

Video game developer

Take-Two Interactive Software

(TTWO) - Get Report

said its selling its Jack of All Games distribution unit, but also cut first-quarter and fiscal year forecasts. Shares shed 6.5% after the postclose announcement.

Citadel Broadcasting

(CTDB.OB)

, one of the country's biggest radiobroadcasters,

filed for Chapter 11 bankruptcy protection

Sunday.

General Motors

tapped

Microsoft

(MSFT) - Get Report

Chief Financial Officer Chris Liddell

for the same post at the automaker.

Overseas, Hong Kong's Hang Seng dropped 1.1% and Japan's Nikkei gained 0.4%. The FTSE in London rose 1.9%, as the DAX in Frankfurt improved 1.7%.

-- Written by Sung Moss in New York