U.S. Stocks Take Breather From Record Run

U.S. stocks finished with small declines, giving back early gains propelled by a new round of mergers and acquisitions activity. Investors also weighed the continued size of Federal Reserve stimulus measures ahead of Fed Chairman Ben Bernanke taking questions from Congress members and the central bank releasing minutes of its latest meeting on interest-rate policy, both on Wednesday. Energy stocks were among the clear winners, Monday, rising over 1.3% as a group as crude oil prices rose, with more of the remaining industry sectors in the S&P 500 tilting to the losing side than winners. Shares of consumer staple and healthcare companies saw the steepest declines.

There were no economic reports to influence market direction but it was a busy weekend on the M&A front. Yahoo! Inc. (YHOO) climbed 0.6% after announcing a $1.1-bln deal for blogging network Tumblr Inc. while Actavis Inc. (ACT) added 1.6% after striking a deal to acquire Warner Chilcott Plc. (WCRX) Websense Inc. jumped 29% after agreeing to be taken private by Vista Equity Partners.

But markets turned south, Monday, after Fed Bank of Chicago President Charles Evans said in remarks to the CFA Society in Chicago that the U.S. economy has improved "quite a lot" as the the central bank maintains its program of bond purchases and other stimulus measure, later saying he expects to see "self-sustaining growth" at "escape velocity" next year.

Fed Speak
Separately, Dallas Fed President Richard Fisher said during a CNBC interview he would have started tapering the $85-bln-a-month stimulus program at the last Federal Open Market Committee meeting had he been a voting member this year.

Later this week, Federal Reserve Board of Governors Chariman Ben Bernanke appears Wednesday before the Joint Economic Committee of Congress. Also on Wednesday, the Fed will release minutes from its May 1 FOMC meeting, with traders again looking for additional clues on the direction of future monetary policy.

Commodities ended higher. Crude oil for June delivery climbed 69 cents to settle at $96.71 per barrel while June natural gas advanced 3.5 cents to finish at $4.09 per 1 mln BTU. June gold rose $19.40 to settle at $1,384.30 per ounce while July silver added 23 cents to finish at $22.57 per ounce.

Here's Where The U.S. Markets Stood At Day's End

• Dow Jones Industrial Index down 19.12 (-0.12%) to 15,335.28
• S&P 500 down 1.18 (-0.07%) to 1,666.29
• Nasdaq Composite down 2.54 (-0.07%) to 3,496.43

• Hang Seng Index up 1.78%
• Shanghai China Composite Index up 0.75%
• FTSE 100 Index up 1.01%

• (+) AQ, Agrees to $316-mln buyout offer from Accenture plc (ACN), accepting $13 in cash for each of its American depositary shares, more than double Friday's closing price for the stock.
• (+) PPHM, Reaches agreement with the U.S. Food and Drug Administration on Phase III testing of its experimental lung cancer drug, comparing bavituximab in combination with other chemotherapy drugs to chemotherapy alone.
• (+) MEAD, Agrees to be acquired by Jinghua Optics for $3.45 a share in cash, or about $4.5 mln overall. The deal is expected to close by the end of July.

• (-) XNPT, Said it will stop developing its arbaclofen placarbil drug candidate after the prospective multiple sclerosis treatment failed to show "statistically significant improvement relative to placebo" during testing.
• (-) NBG, Announces plans to sell 2.27 bln new shares at a price of 4.29 euros - or about $5.50 each - as part of its recapitalization plan by Greece's largest lender. The offering price accounts for a 1-for-10 reverse stock split.
• (-) RIG, Named in a suit filed late Friday by Texas officials seeking damages connected to the April 2010 Deepwater Horizon explosion and oil spill. Other defendants include BP (BP), Anadarko (APC) and Halliburton (HAL).