Stocks Flat at the Finish Line

NEW YORK ( TheStreet) -- The major U.S. stock averages finished flat Monday with investors mostly sticking to the sidelines after last week's big pullback following the election results.

The sideways trading came as upbeat trade data from China and a modest dose of M&A action was set against uncertainty about Greece's next round of bailout funds and budget talks coming up between Democratic and Republican congressional leaders.

The Dow Jones Industrial Average dipped less than a point, or 0.23%, to close at 12,815.16. The blue-chip index shed 2.12% last week, its worst weekly performance in more than five months, but it's still up 4.89% so far in 2012.

Breadth within the Dow was slightly negative as losers outpaced winners 16-to-13. Shares of Alcoa ( AA) closed flat. The biggest percentage decliners were Microsoft ( MSFT), Hewlett-Packard ( HPQ), and UnitedHealth ( UNH).

Shares of Microsoft closed down 2.1% after CEO Steve Ballmer was quoted as saying the company's Surface tablet was having a "modest" debut.

Blue chips moving higher included AT&T ( T), Disney ( DIS), and United Technologies ( UTX).

The S&P 500 rose 0.15 points, or 0.01%, to settle at 1380, while the Nasdaq lost 0.61 points, or 0.02%, to finish at 2904.26.

The strongest sectors in the broad market were capital goods, financials, and transportation, while utilities and technology were under the most selling pressure.

Apple ( AAPL) shares slipped 0.77% as DigiTimes reported that the tech giant will start trial production of a new version of the iPhone 5 next month.

In other Apple news, the iPhone maker and Taiwanese gadget manufacturer HTC have settled their patent dispute.

Decliners outpaced advancers by a 1.1-to-1 ratio on both the New York Stock Exchange and Nasdaq. Volume was at 2.53 billion on the Big Board and 1.38 billion on the Nasdaq.

Over the weekend, China reported its export growth soared to its highest in five months in October, surpassing estimates at over 11%, and calming fears that the world's second-largest economy was stalling.

The data helped offset a dour report from Japan, which said that the country's economy shrank 0.9% in the third quarter, the first contraction in in three quarters, weighed down mostly by weaker external demand.

Even as the major averages were pulling back on the heels of last week's volatile week of trading, Peter Cardillo, chief market economist at Rockwell Global Capital said Monday that he thinks "if the S&P 500 holds around the present levels, the worst of the decline is behind us."

"Indeed, the market is looking to stabilize notwithstanding the weekend rhetoric concerning the fiscal cliff, China's exports reaching a five-month high is another indication of the Chinese economy stabilizing, a positive for the global economy. Today's domestic M&A news also helping the market in the absence of macro news," said Cardillo.

Meantime, both Democrats and Republicans expressed confidence that they could reach a deal to avoid plunging off the fiscal cliff, though provided little detail beyond that.

No major U.S. economic releases were expected Monday. The bond market was closed and most federal workers were off in observance of Veteran's Day.

Economic releases later this week include the consumer price report on Thursday and several manufacturing indicators, such as the Empire manufacturing, Philly Fed, and industrial production reports.

There will also be retail sales data on Wednesday, where there could be distortions due to Hurricane Sandy.

The FTSE 100 in London settled down by 0.04%, while the DAX in Germany finished up 0.07%. Japan's Nikkei average settled down 0.93% on Monday and Hong Kong's Hang Seng closed higher by 0.21%.

Gold for December delivery closed unchanged at $1,730.90 an ounce at the Comex division of the New York Mercantile Exchange, while December crude oil contracts fell 50 cents to settle at $85.57.

The dollar was down 0.01%, according to the U.S. dollar index . The bond market was closed.

In corporate news, Leucadia National ( LUK) agreed to acquire Jefferies Group ( JEF), the two companies announced on Monday.

Jefferies shares soared 14%; Leucadia shares fell 3%.

Titanium Metals ( TIE) shares surged 42.6% after the titanium manufacturer entered a deal to be bought by Precision Castparts ( PCP) for $16.50 a share in cash, putting the value of the company at about $2.9 billion. Precision Castparts shares rose 4.9%.

D.R. Horton ( DHI ) shares tumbled 5.8% after the homebuilder posted quarterly results that missed Wall Street's expectations.

Beazer Homes ( BZH) shares plunged 17.3% after the homebuilder reported a bigger quarterly loss than forecast; sales increased more than expected.

Research In Motion ( RIMM) shares added 3.2% as the company announced that it will hold its BlackBerry 10 launch event on Jan. 30, 2013.

Best Buy ( BBY) will hire Sharon McCollam, the former Williams-Sonoma ( WSM) chief financial officer, as its next finance chief. Best Buy shares climbed 3.6%.

Celgene ( CELG) shares jumped 5.8% after the company said Friday night that its cancer drug Abraxane prolonged the survival of patients with advanced pancreatic cancer in a closely watched phase III study.

Annaly Capital Management ( NLY), the manager of real estate related investments, has proposed to acquire the shares of Crexus Investment ( CXS) that Annaly does not already own. Crexus shares popped 12% and Annaly shares fell 0.73%.

-- Written by Andrea Tse and Joe Deaux in New York.

>To contact the writer of this article, click here: Andrea Tse.

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