Stocks Higher on Merger Torrent

A deluge of corporate dealmaking fed the bulls Monday at the outset of a big week for economic and interest-rate news.

Index futures recently showed the

S&P 500

Trading 2 points above fair value, while the Nasdaq 100 was set for a 1-point gain. The 10-year Treasury bond was down 1/32 in price to yield 5.23%, while the dollar fell against the yen and euro.

The morning's corporate headlines were dominated by merger news, including a $40 billion transaction in which

Phelps Dodge

(PD) - Get Report

will take control of Canadian miners

Inco

(N)

and

Falconbridge

. The agreement will create the world's largest producer of nickel and copper.

Elsewhere,

Johnson & Johnson

(JNJ) - Get Report

confirmed an agreement to acquire the consumer healthcare operations of

Pfizer

(PFE) - Get Report

for $16.6 billion, while Dutch steel giant

Mittal

(MT) - Get Report

closed a deal to acquire

Arcelor

for about $34 billion.

Overseas markets were mostly higher, with London's FTSE 100 recently adding 0.2% to 5701 and Germany's Xetra DAX gaining 0.2% to 5543. In Asia, Japan's Nikkei rose 0.2% overnight to 15,152, while Hong Kong's Hang Seng was little changed at 15,805.

Most commodity prices were lower, including crude, which fell 10 cents to $70.77 a barrel. Gold fell $1 to $587 an ounce, while silver lost 10 cents to $10.28 an ounce and copper lost 4 cents to $3.11 a pound.

Stocks lost ground last week as traders braced for this Thursday's interest rate decision from the

Federal Reserve

. Over the five sessions, the

Dow Jones Industrial Average

lost 0.2%, while the S&P 500 fell 0.6% and the

Nasdaq Composite

lost 0.4%.

In earnings news Monday,

Lennar

(LEN) - Get Report

said its second-quarter profit rose 39% to $325 million, or 2 cents a share, beating estimates. The homebuilder also cut its full-year forecast to $8 to $8.25 a share, from previous guidance of $9.25 a share, citing a slowdown in orders.

To view David Peltier's video take on today's premarket action, click here

.

Later Monday, the Commerce Department is expected to say that new homes sold at an annualized rate of 1.15 million last month, down 1.20 million in April. On Tuesday, existing home sales, as measured by the National Association of Realtors, are expected to fall to 6.62 million for May, from 6.76 million in April.