The Dow Jones Industrial Average was down 8 points at 13,545, as 20 of its 30 components retreated, led by the likes of Alcoa Inc. , Dupont , Honeywell Inc. and United Technologies .
General Electric Co. rose 0.3% before the open after saying it will sell its GE Plastics business to Saudi Basic Industries Corp. for $11.6 billion. The $9 billion after-tax proceeds, GE said, will be used to buy back its shares.
Also weighing on blue chips, AT&T fell 0.1% after announcing a rebranding of its Cingular unit ahead of Apple Inc.'s launch of the iPhone.
And Pfizer fell 0.2% after news that CFO Alan Levin is resigning, while its head of research and development, John LaMattina, will retire as soon as the New York drug giant finds a successor.
The S&P 500 index rose 1.8 points to 1,524, while the Nasdaq Composite gained 5.8 points to 2,564.
Among technology shares, Yahoo rose 0.8%. It may pay $1 billion to buy Bebo, a leading U.K. social networking site, according to a report from a British newspaper.
Deals, deals, deals
The market is coming off a strong week in which the Dow rose 1.7% to a new record high, while the S&P 500 rose 1.1%, coming within 5 points of its all-time high.
The key fuel for the market's rally has remained deal-making.
On Monday, Alltel Corp. gained 7.3% after agreeing to be bought by TPG Capital and a Goldman Sachs unit for $27.5 billion, or $71.50 a share. That's a 10% premium to Friday's close and a 23% premium to Alltel's price before reports of a possible buyout first appeared.
One major international deal had UniCredit buying Italian peer Capitalia in an all-stock transaction valued at over $29 billion. The deal will make UniCredit Europe's second-largest bank.
Hologic agreed to buy Cytyc for $6.2 billion, or $16.50 a share in cash and 0.52 of Hologic shares. The deal at a 33% premium to Friday's close will generate a leading provider of women's health services.
The bidding war for EGL continued with a group led by Apollo Management offering $47.50 a share in cash, trumping a $46.25 a share offer from a group led by EGL's chief executive.
Another deal had Atlas Energy Resources agreeing to buy 2,150 natural gas wells producing from the Antrim Shale, located in Michigan's northern lower peninsula, from DTE Energy for $1.23 billion in cash.
Economy returns to backburner
A series of better-than-expected economic data recently has soothed investor concerns about a potential housing-led recession.
Industrial data, especially, "has lifted energy and basic materials stocks, as well as heavy industrial and large cap multinational stocks [on the Dow and S&P]," said Marc Pado, market strategist at Cantor Fitzgerald.
There's not much on the economic docket on Monday with statistics on housing sales and durable-goods orders due out later in the week.
The dollar rose against the yen and the euro, with the greenback strength coming even after Kuwait over the weekend abandoned the U.S. dollar peg.
June gold futures fell $1.10 to $660.60 an ounce, while July-dated crude futures rose 24 cents to $66.22 a barrel.
Elan shares jumped 11% after the Irish drugmaker and Wyeth began a Phase III trial of an Alzheimer's drug candidate. There are two ongoing Phase 2 studies of the drug, and Elan cautioned that no conclusions can be drawn.
On the earnings front, Lowe's reported a 12% profit decline, citing the housing market and last year's hurricane rebuilding activities.
Merck president of global human health, Peter Loescher, is leaving to become chief xecutive of Siemens , the German industrial conglomerate. Merck didn't name a replacement.
By Nick Godt