NEW YORK (AP) - Wall Street traded mostly higher Tuesday as investors remained cautiously optimistic following new takeover talk and data showing resilience among U.S. consumers.
The first day of the week frequently brings big acquisition offers, and this shortened week was no exception: On Tuesday, a consortium of banks led by Royal Bank of Scotland PLC said it will bid 71.1 billion euros, or $95.5 billion, for the Netherlands' ABN Amro, besting an offer from Barclays PLC.
The announcement came amid news that Tishman Speyer Properties and Lehman Brothers Holdings Inc. are buying Archstone-Smith Trust for at least $13.5 billion.
This year's torrent of deals -- on pace to top last year's record tally of $4 trillion, according to financial data provider Dealogic -- have aided the Dow Jones industrial average's ascent to new heights, despite U.S. economic data that has been coming in mixed.
The housing sector looked weak after the Standard & Poor's housing index indicated that U.S. home prices declined 1.4 percent in the first quarter compared to a year ago, the first time since 1991 that prices posted a quarterly drop. However, the consumer appeared strong; the Conference Board said its Consumer Confidence Index rose to 108.0 in May, up from a revised 106.3 in April. The results beat the average analyst estimate.
'The rise in consumer confidence during the month is really quite impressive in the face of the record highs in gasoline prices,' said Georges Yared, chief investment strategist for Yared Investment Research. 'As long as the private equity folks continue to remain active, that's a very bullish scenario for the stock market.'
Most investors are hoping the economy is growing fast enough to stoke companies' U.S.-based businesses, but not so quickly that it would prevent the Fed from lowering interest rates later in the year.
In midday trading, the Dow slipped 6.18, or 0.05 percent, to 13,501.10, after rising more than 50 points in earlier trading.
Broader stock indicators were higher. The Standard & Poor's 500 index advanced 0.79, or 0.05 percent, to 1,516.52, and the Nasdaq composite index added 9.50, or 0.37 percent, to 2,566.69.
'It's a bit of a wishy-washy day ... People are starting to get their sea legs back after a long weekend,' said Joe Ranieri, managing director in equity trading, Canaccord Adams. He noted that the market appears hesitant to take strong positions ahead of Wednesday's release of minutes from the Federal Reserve's last meeting.
Bonds fell after the consumer confidence data, with the yield on the benchmark 10-year Treasury note rising to 4.88 percent from 4.86 percent late Friday. The dollar slipped against other major currencies, and gold prices climbed.
U.S. retail gasoline prices have eased slightly from their record high of $3.227 a gallon, on average, but remained high Tuesday at $3.201, according to AAA. Crude oil futures fell $1.17 to $64.03 a barrel on the New York Mercantile Exchange.
After it was reported that Archstone was being bought, the stock rose $5.52, or 10 percent, to $60.75.
In other takeover news, the Wall Street Journal said technology retailer CDW Corp. and telecommunications equipment company Avaya Inc. are private equity takeover targets.
Avaya rose $1.96, or 14 percent, to $15.63 and CDW rose $6.54, or 8.6 percent, to $82.10.
In other takeover news, engineering and construction company URS Corp. said late Monday it will buy competitor Washington Group International for $2.6 billion. Washington Group rose $11.18, or 16 percent, to $81.15, and URS rose $1.51, or 3.2 percent, to $48.40.
This week is light on earnings results, but in a promising sign for technology companies, Vodafone Group PLC said it narrowed its full-year loss. U.S. shares of the world's biggest mobile phone company rose $1.10, or 3.6 percent, to $31.66.
Bookseller Borders Group Inc. is scheduled to release first-quarter results Tuesday after the markets close. Borders fell 16 cents to $23.25.
In other economic data, the Dallas and Chicago Federal Reserves both reported expansions in regional manufacturing activity.
Advancing issues outnumbered decliners by more than 2 to 1 on the New York Stock Exchange, where volume came to 619.8 million shares.
The Russell 2000 index of smaller companies was up 6.68, or 0.80 percent, at 836.61.
Overseas, Japan's Nikkei stock average rose 0.48 percent. In afternoon trading, Britain's FTSE 100 was up 0.55 percent, Germany's DAX index was up 0.54 percent, and France's CAC-40 was down 0.25 percent.
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