Stocks closed higher as hedge funds and speculators covered shorts and adjusted positions for long Thanksgiving holiday weekend, says Standard & Poor's MarketScope.
The Dow Jones industrial average rose 53.95 points to 10,820.28. The broader Standard & Poor's 500 index was up 7.58 points to 1,241.67. The tech-heavy Nasdaq composite index gained 14.6 points to 2,233.57.
Crude oil futures rose 49 cents to $57.70 a barrel. Colder weather in the U.S. Northeast supported crude and heating oil prices, though natural gas was pressured by expected weak demand, says Action Economics.
Among stocks on the move, General Motors (GM) fell after the auto maker announced that it is cutting 30,000 jobs in an aggressive $7 billion cost cutting program. The company also confirmed "significant restructuring charges" along with early retirement costs related to the move, which should ultimately return the auto manufacturer to profitability, but are yet to be disclosed, says Action Economics. It is also aiming to reduce healthcare costs, though the key issue of pension liability remains murky, says Action Economics.
Boeing (BA) announced three firm orders for 68 of its airplanes plus rights for 24 additional planes from United Arab Emirates, International Lease Finance Corp, and Low-Cost Aircraft Leasing; the deals have total value of about $13.18 billion.
Computer Sciences (CSC) was down on a report that said Lockheed Martin (LMT) and three private equity firms had abandoned talks to buy it. Wachovia downgraded the stock to market perform from outperform.
Alamosa Holdings (APCS) agreed to be acquired by Sprint Nextel (S) for about $4.3 billion, including about $900 million in debt, or $18.75 per APCS share in cash.
In other deal news, Mentor (MNT) made a bid to acquire Medicis Pharmaceutical (MRX) for $2.2 billlion. Medicis rejected the unsolicited proposal and says it "remains committed to completing its proposed merger with Inamed (IMDC)."
The economic calendar is light this week due to the Thanksgiving Day holiday on Thursday. One key release, says Action Economics, will be the FOMC's minutes from the Nov. 1 policy meeting, due out at 2 p.m. EST Tuesday. The markets will be keen to see if there are any hints of an imminent change in the policy statement at the Dec. 13 meeting or in January, says Action Economics.
On Monday, the October leading economic indicators rose 0.9%, a bit stronger than expected.
European stock markets were mostly higher on Monday. London's FTSE-100 index edged slightly lower, while Germany's DAX index and France's CAC-40 index rose. In Asia, the Nikkei 225 index and Hang Seng finished higher.
Treasury yields fell, after European Central Bank chief Trichet unwound some of his most hawkish remarks from Friday, which had driven both eurozone and U.S. yields higher, says Action Economics. While he said that the bank was still ready to reduce some accommodation, he warned that it would be potentially wrong to interpret his remarks as kicking off a series of rate hikes, says Action Economics. The 10-year yield moved down to 4.45%.