The Dow Jones industrial average rose 70.58 points, or 0.68%, to 10,519.72. The broader Standard & Poor's 500 index added 7.58 points, or 0.63%, to 1,219.44. The tech-heavy Nasdaq composite was up 22.55 points, or 1.07%, to 2,135.43.
August crude oil futures settled down 71 cents to $58.92 per barrel, after Hurricane Dennis left oil rigs and platforms in the Gulf of Mexico unscathed, alleviating concerns of supply disruptions, says Standard & Poor's MarketScope.
Looking ahead to Tuesday, PepsiCo (PEP
) will be among the companies reporting earnings. The only noteworthy economic releases will be weekly reports on retail sales.
No major economic reports were released on Monday.
Investors were greeted with a number of merger-related headlines Monday morning. Dutch media group VNU (VNU
), which owns the Nielson television ratings service, announced Monday that it will acquire U.S. health-care data provider IMS Health (RX
) for about $7 billion in cash and stock.
Oil group Unocal (UCL
) agreed to sell a Canadian subsidiary, Northrock Resources, to Houston oil firm Pogo Producing (PPP
) for $1.8 billion in cash. Unocal is the target of competing takeover bids from Chinese National Offshore Oil Company (CEO
) and Chevron (CVX
The Wall Street Journal reported that Kohlberg Kravis Roberts and Silver Lake have emerged as the leading bidder to buy Agilent Technologies' (A
) chip-products business in an auction that is expected to fetch as much as $2.5 billion.
) said Monday that it agreed to acquire affiliate U.S. Unwired (UNWR
) for about $1.3 billion in cash. The Louisiana-based wireless provider had filed a lawsuit to block Sprint's acquisition of Nextel Communications (NXTL
), but as part of the merger deal, the companies will seek a postponement to the litigation pending in the U.S. District Court.
Investment bank Goldman Sachs' (GS
) private equity unit and German insurance and asset management group Allianz (AZ
) are in talks to buy a more than $1 billion stake in the Industrial and Commercial Bank of China, one of the country's biggest commercial state-run banks, according to The Wall Street Journal.
Film studio DreamWorks Animation (DWA
) lowered its fiscal year forecast Monday and said that it expects to post a second-quarter loss, thanks to lower-than-expected sales of home videos. The company also said that the Securities and Exchange Commission has launched an informal inquiry into the trading of the company's shares.
U.S. Treasuries ended the day mixed Monday. The yield on the benchmark 10-year note was at 4.10%. Action Economics noted that Richmond Federal Reserve President Jeffrey Lacker said Monday that it was still too early to expect a pause in the Federal Reserve's campaign of monetary tightening.
European stock markets closed higher Monday. London's FTSE 100 index rose 10.20 points, or 0.19%, to 5,242.40, as British input prices rose 2.1% in June, which was more than expected, thanks to higher oil prices, but output prices fell 0.2%. Mobile phone service provider Vodafone was higher following a Spanish newspaper report that the company is not interested in T-Mobile USA, the U.S. wireless unit of Deutsche Telekom, and Prudential insurance and asset management group was higher on a newspaper report that Citigroup is considering a bid for Egg, the internet bank mostly owned by Prudential.
In Germany, the DAX index went up 65.41 points, or 1.42%, to 4,663.38. Software group SAP was higher after JP Morgan Chase raised a revenue forecast for the group, and chipmaker Infineon climbed on higher spot prices for memory chips.
In Paris, the CAC 40 index rose 21.25 points, or 0.49%, moving to 4,321.56. Air France-KLM was among the gainers following a report that the company is planning to divert 662 million euros from the cabin crew pension surplus and count it as profit over five years. France Telecom was also higher after the newspaper Investir added the stock to its "favorites" list.
Asian markets rallied Monday, boosted by strong finishes in the U.S. and Europe Friday and a drop in crude oil to below $59 a barrel. In Japan, the Nikkei index gained 108.80 points, or 0.94%, to 11,674.79.
In Hong Kong, the Hang Seng index gained 192.77 points, or 1.38%, to 14,157.24.