Stocks Overcome Geopolitics

Wall Street closes higher despite North Korea's nuclear weapon test and an OPEC output cut.
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Updated from 4:26 p.m. EDT

Even with North Korea's escalating nuclear ambitions and the prospect of less oil on the market, Wall Street stood its ground and closed slightly higher Monday.

The

Dow Jones Industrial Average

finished the session up 7.60 points, or 0.06%, to 11,857.81, having been down as many as 37 points earlier in the session. The index hit a high of 11,872.94, surpassing the intraday record of 11,870.06 reached last week.

The Dow achieved the milestone thanks to

Caterpillar

(CAT) - Get Report

,

General Motors

(GM) - Get Report

and

Home Depot

(HD) - Get Report

all climbing by 1.3% or more.

Elsewhere, the

S&P 500

closed up 1.08 points, or 0.08%, at 1350.66, and the

Nasdaq Composite

overcame a weak opening and added 11.78 points, or 0.51%, at 2311.77.

Nvidia's

(NVDA) - Get Report

6.4% advance helped the Nasdaq finish with gains. Nvidia has added more than 12% in the last five sessions.

"The market seems, at this point, to be invulnerable to any geopolitical story," said Barry Hyman, equity market strategist with EKN Financial. "The money flow and sector rotation remain strong. The market is fixated on the idea that we're assured a soft landing and that interest rates are headed down."

About 1.98 billion shares changed hands on the

New York Stock Exchange

. Advancers beat decliners by a 9-to-7 margin. Volume on the Nasdaq was 1.52 billion shares, with winners edging losers 8 to 7.

To view Farnoosh Torabi's video take on today's market, click here

The market shook off fears emanating from claims out of North Korea that it had successfully detonated a nuclear weapon in an underground test. Both South Korea and China denounced the North Korean leadership immediately after the announcement, and they were soon joined by other nations in condemning the development.

Stocks fell in South Korea and Hong Kong, but indices in mainland China moved higher. Tokyo's markets were closed for a holiday.

Back in the U.S., the indices' move higher comes just before earnings season begins Tuesday, when Dow component

Alcoa

(AA) - Get Report

kicks things off with its third-quarter report. Alcoa closed up 0.9%, lending support to the Dow.

"This is the first official week for earnings season," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "The key in looking at these reports is to focus on revenue growth and not per-share earnings, because many companies are using buybacks to boost per-share numbers to meet forecasts."

Dominating the corporate news Monday were mergers and acquisitions. The biggest confirmed deal involved a plan by

PNC Financial

(PNC) - Get Report

to pay $6 billion for

Mercantile Bankshares

(MRBK) - Get Report

. Pittsburgh-based PNC will pay the equivalent of $47.24 a share for Mercantile, sending the Baltimore bank's stock up 22.2% to finish at $44.94.

In the tech space,

Google

(GOOG) - Get Report

said after the bell Monday it will pay $1.65 billion for the popular online video site YouTube. The deal is expected to be completed in the fourth quarter, after which YouTube will operate independently. Google was higher by $8.50, or 2%, to $429 before falling in the after-hours session.

Elsewhere, the Dolan family is aiming to buy out the public stockholders of the company it controls,

Cablevision Systems

(CVC)

. The Dolans offered $27 a share for the stake, valuing the company at about $7.9 billion. Shares of Cablevision surged $2.57, or 10.7%, to $26.50.

Away from stocks, the dollar fell against most of the world's major currencies. Crude futures rose 20 cents to close at $59.96 a barrel after word that OPEC will cut production. Other energy contracts were stronger, as well.

Gold rose $5.70 to $582.50 an ounce, and silver added 24 cents to $11.42 an ounce. The bond market was closed for the Columbus Day holiday.

Among analyst moves, both Citigroup and Goldman Sachs downgraded

MasterCard

(MA) - Get Report

, and shares fell 3.1% to $72.80.

Elsewhere, Citigroup upgraded

AT&T

(T) - Get Report

to buy from hold, while cutting its rating on

Verizon

(VZ) - Get Report

to sell from hold.

AT&T added 40 cents, or 1.3%, to $32.18. Verizon finished down 11 cents, or 0.3%, to $36.69.

Europe's equity measures were mixed. London's FTSE 100 was up 0.4% to 6023, but Frankfurt's Xetra DAX was lower by 0.3% to 6066.