Updated from 4:17 p.m. EDT

Stocks in the U.S. closed narrowly mixed Tuesday, as traders kept from making further big bets a day after the Dow Jones Industrial Average closed at its highest level ever.

The Dow slipped about 40.24 points, or 0.29%, to 14,047.31. The S&P 500 lost 0.41 point, or 0.03%, to 1546.63. The Nasdaq Composite added 6.12 points, or 0.22%, to 2747.11.

The session included news of several mergers in the financial sector, as well as another bleak report on the housing market. But overall traders marked time following Monday's blowout start to the fourth quarter.

In the prior session, the Dow jumped 191.92 points, or 1.38%, to 14,087.55, a record finish for the blue-chip index and the first time it closed above 14,000 since July 19. The S&P 500 added 20.29 points, or 1.33%, at 1547.04, and the Nasdaq rose 39.49 points, or 1.46%, to 2740.99.

"Today was essentially a push, but after an incredible up move yesterday it was good we didn't retrace the gains," said Art Hogan, chief market analyst with Jefferies. "There weren't too many drivers today. We took a pause after the big run-up to digest ahead of a plethora of economic data due later this week, all coming to a crescendo with Friday's jobs report."

Breadth was mildly positive Tuesday. On the New York Stock Exchange 3.20 billion shares changed hands, as advancers topped decliners by a 9-to-7 margin. Volume on the Nasdaq reached 1.78 billion shares, with winners outpacing losers nearly 3 to 2.

"This kind of action is what we see in the latter stages of an advance," said Phillip Roth, chief technical market analyst with Miller Tabak. "Laggards are the only stocks higher today, which suggests that traders are panicking that the blue chips are making new highs and are looking for easy profits. The rally may not be through, but it's tough to make progress now."

The big headlines of the day came from the financial sector. Commerce Bancorp ( CBH), a New Jersey bank, agreed to be acquired by Canada's TD Bank ( TD) for $8.5 billion in stock and cash. Shares of Commerce were off 0.3% to $39.47, and TD Bank shares slid 5.6% to $72.65.

Financial giant Citi ( C) said will acquire the rest of Nikko Cordial, a Japan-based broker, for $4.6 billion. Earlier this year, Citi spent close to $8 billion to acquire a 68% stake in Nikko.

In addition, Royal Bank of Canada ( RY) laid out plans to buy a Caribbean bank, RBTT Financial Group, for roughly $2.2 billion. Shares of Royal Bank of Canada added 29 cents, or 0.5%, to $56.68.

On the economic front, the National Association of Realtors said its pending home sales index dropped a greater-than-expected 6.5% in August. Economists expected the index to decline 2%.

"This is still absolutely awful, confirming that the existing homes market is now in freefall," said Ian Shepherdson, chief economist with High Frequency Economics. "Moreover, there is no sign yet that the bottom of the market is near. With price declines accelerating, real mortgage rates are very high and rising further."

Even so, the sector was strong, and the Philadelphia Housing Sector Index jumped 2.9%. Hovnanian ( HOV), Toll Brothers ( TOL), D.R. Horton ( DHI), and Lennar ( LEN) all climbed 6% or more.

In the tech sector, Palm ( PALM) reported a fiscal first-quarter loss after the previous close. Excluding items, the smartphone maker beat Wall Street's estimates by a penny, but disappointing guidance for the second quarter sent the stock down 55 cents, or 3.4%, to $15.45.

Rival Research In Motion ( RIMM) shed 2.4% after Raymond James downgraded the stock to market perform from outperform. RIM eased $2.40 to end the session at $96.26.

Elsewhere, Pepsi Bottling ( PBG) said its third-quarter earnings jumped more than 25% from a year ago, surpassing the Thomson First Call average estimate. Revenue for the quarter also topped forecasts. Shares advanced 78 cents, or 2.1%, to $37.97.

Throughout the session, major automakers reported their September sales data. General Motors ( GM) said vehicle sales rose 4% on an adjusted basis last month. Shares of the Dow component climbed $1, or 2.8%, to $37.05.

On the other hand, Ford ( F) reported a 20.5% drop in last month's sales, and Toyota ( TM) posted a 4.4% decline.

Meanwhile, major overseas markets were mostly higher. Tokyo's Nikkei advanced 1.2%, and Hong Kong's Hang Seng surged 3.9%. London's FTSE eased 0.1%, while Frankfurt's Dax rose 0.3%.

Treasury bonds reversed early losses and climbed. The 10-year note ended up 6/32, reducing the yield to 4.52%, and the 30-year bond added 9/32 to yield 4.77%. The beaten-down dollar was rising against foreign currencies.

Commodities ended the day lower. The front-month November crude contract dropped close to $79 a barrel before closing down 19 cents at $80.05 a barrel. Gold and silver futures finished sharply lower.

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