NEW YORK (TheStreet) -- Stocks were hovering at the flatline but close to record levels after the S&P 500 nudged to a new high to close out last week.
The S&P 500 gained 0.04%, the Dow Jones Industrial Average fell 0.05%, and the Nasdaq climbed 0.06%.
Apple (AAPL) shares rose 0.7% on Monday to $129.66 after activist investor Carl Icahn called current valuation "undervalued." He said Apple is worth $240 a share. In a letter to Apple CEO Tim Cook, Icahn also called for accelerated buybacks.
"After reflecting upon Apple's tremendous success, we now believe Apple shares are worth $240 today," wrote Icahn. "Apple is poised to enter and in our view dominate two new categories (the television next year and the automobile by 2020) with a combined addressable market of $2.2 trillion, a view investors don't appear to factor into their valuation at all."
BHP Billiton (BHP) plunged 5.4% after the company's South32 spinoff was valued at around $9.1 billion, the lower end of expectations. The split will allow BHP to focus on its businesses in iron ore, petroleum and coal.
A measure of homebuilder confidence declined 2 points to 54 in May, though remained above the 50 level indicating optimism, according to the National Association of Home Builders/Wells Fargo data. The gauge was pulled lower by signs of weakness in sales of single-family homes. Economists had expected the measure to increase to 58.
Crude oil prices surged above $60 a barrel on news of further fighting in the Middle East, including Iraqi city Ramadi being captured by ISIS and continued airstrikes in Yemen. Investors hope potentially restricted supply in oil-rich Middle Eastern countries will help to rebalance global supply and demand. West Texas Intermediate crude added 1% to $60.29 a barrel.
The Federal Reserve could hike interest rates sooner than expected with Chicago Fed President Charles Evans noting overnight in a speech that a June hike is a possibility. Evans, speaking in Stockholm, also said the Fed wouldn't likely reach its 2% inflation target until 2018. The majority of economists believe the Fed will hike no sooner than September.
Fed Chair Janet "Yellen and [New York Fed president William] Dudley gave words that suggested they fully expect volatility around the hiking idea which is another way of saying the Fed won't be swayed to postpone their intent simply because the markets are jumping about," said CRT Capital Group's Ian Lyngen.
Endo Pharmaceutical (ENDP) shares fell after the company agreed to buy privately held Par Pharmaceutical Holdings for $8.05 billion in cash and stock. The deal would create one of the five largest generic drugmakers in the U.S.
Apple (AAPL) shares were on watch after the tech giant bought high-precision GPS service firm Coherent Navigation for an undisclosed amount. The purchase will work toward improving Apple Maps.
Intel (INTC) and Altera (ALTR) reportedly have restarted negotiations surrounding a potential deal, according to the New York Post. Altera had previously rejected a $54-a-share deal in April. Altera shares jumped nearly 7%.
Eleven Bio (EBIO) plummeted more than 70% after a Phase 3 trial for dry eye disease failed to achieve its co-primary endpoints. Given the results, Eleven Bio will not proceed with a second Phase 3 trial.
Google (GOOGL) will reportedly begin to experiment with "Buy" buttons which will embed purchase links in search product ads. The search engine giant reportedly won't charge advertisers for the Buy buttons, instead hoping for higher conversion rates and increased advertising spend, according to The Wall Street Journal.