11:30AM U.S. stock averages traded mixed. Arris weighed on the tech sector.
U.S. stock market averages turned mixed in late morning trading, as oil prices jumped above $62 offsetting merger activity, including the $45 billion acquisition of UTX, the biggest private-equity deal ever. Stocks failed to sustain earlier gains amid concerns of a market correction. The Dow remained in the positive, helped by 3.8% gain for drug maker Merck (MRK: chart) and 1.3% for Coca-Cola (KO: chart) on the back of brokerage upgrades. The tech sector was weighed down by Arris Group (ARRS: chart), falling 11% after Ericsson bid $1.4 billion for Tandberg Television, topping Arris' offer. The downward move by the tech-heavy Nasdaq reflected weakness among computer hardware, networking, and software stocks, due to profit taking after recent strength. Among other companies in focus, XM Satellite Radio Inc. (XMSR: chart) rose 2.3% after it said its Q4 loss narrowed from a year ago on 45% higher revenue and lower subscription acquisition costs.

On the merger-and-acquisition front, UTX Corp. (UTX: chart) soared 13% after it agreed to be purchased by a private-equity group. Dow Chemical (DOW: chart) climbed 7% on bid speculation. Station Casinos (STN: chart) rose 4.2% after it agreed to go private in a $5.4 billion deal, which is an 8% premium over its closing price on Friday. Temple-Inland (TIN: chart) spiked 14% after it agreed to spin off its real estate and financial services arms. In late morning trading, the Dow rose 9.70, or 0.08%, to 12,657.18. The Standard & Poor's 500 index was up 2.06, or 0.14%, at 1,453.25, and the Nasdaq composite index fell 7.81, or 0.31%, to 2,507.29. Bonds continued to rise from last week's sell-off, with the yield on the benchmark 10-year Treasury note falling to 4.65% from 4.68% late Friday.


9:45AM U.S. stocks opened higher, lifted by UTX, Station Casinos.
U.S. stocks opened notably higher Monday on well-received deal news, including the $45 billion takeover of TXU Corp. (TXU: chart). The shares of the utility jumped 13% after agreeing to be bought by a consortium led by Kohlberg Kravis & Roberts and Texas Pacific Group. If approved, the deal would be the biggest private buyout ever. Further boost to the market sentiment was provided by Station Casinos (STN: chart) which gained 4.2% after Company Management and Colony Capital agreed to buy the casino-operator for $8.8 billion. Among other notable gainers in morning trading, Temple-Inland Inc. (TIN: chart) surged 13% after it announced plans to separate itself into three standalone public companies. The conglomerate agreed to spin off its real estate and financial services arms, and sells its timberland business.

Dow component Merck (MRK: chart) rose 2.7% after being upgraded to buy at Citifroup on its outlook for a diabetes drug that will compete with Novartis''s Galvus. At the same time Novartis (NVS: chart) fell 1.8%. Among companies driven by analyst comments, Brightpoint (CELL: chart), cell phone distributor, gained 2.1% on brokerage upgrade, while shares of Moody''s (MCO: chart) dropped 3.6% after Credit Suisse downgraded its rating on the credit services provider. By sector, utility, housing and energy stocks posted strength in early trading, while the oil-sensitive transportation sector declined. In the first hour of trading, the Dow rose 13.06, or 0.10%, to 12,660.54.The Standard & Poor''s 500 index was up 4.03, or 0.28%, at 1,455.22, and the Nasdaq composite index dipped 0.71, or 0.03%, to 2,514.39. Bonds continued to recover from last week''s sell-off, with the yield on the benchmark 10-year Treasury note falling to 4.64% from 4.68% late Friday.


9:30AM London is higher Monday on Persimmon and AB Foods.
The UK market was higher on Monday. By late morning, the FTSE 100 gained 43.7 points at 6,446.4.

Advancers

AB Foods rose 5.1% as it reported a strong performance from its sugar businesses and a 4% rise in sales at the Primark fashion chain. Strong full-year results boosted housebuilder Persimmon, 3.6% higher, and Old Mutual, the life assurer, up 2.8%.

As the crude price rose a further 28 cents to $61.42, oil stocks were again stronger. BP rose 2.1% and Cairn Energy gained 1.8%. Miners also traded higher after a strong session in Asia overnight. Kazakhmys, the copper miner, gained 2.4%.

Decliners

William Ransom has warned profit growth for the full year to March 31 would come in below its own previous expectations due to a slower than expected recovery in a key export market. William Ransom declined 20.6%. Alfred McAlpine crashed as it warned it had discovered signs of a systematic fraud at its Slate subsidiary. The stock fell 19.6%.

BSkyB declined 0.6% on continued worries about its dispute with Virgin Media. BSkyB announced discussions with Virgin Media about the carriage of Sky basic channels were ongoing and there was a real possibility that agreement would not be reached before expiry of the current contract at midnight on February 28. The higher crude price dragged Carnival, the cruise operator, 0.3% lower.


9:00 AM Market futures pointed to a higher opening, helped by merger activity.
U.S. stock market futures moved higher on Monday, boosted by a multi-billion takeover of utility giant TXU which raised consolidation hopes. Shares of TXU (UTX: chart) jumped 13% in the pre-open after agreeing to be bought by a private-equity group for $45 billion, including $13 billion in debt. In another deal, Company management and Colony Capital agreed to buy Station Casinos (STN: chart) for $8.8 billion, including $3.4 billion in debt. Dow Chemical (DOW: chart) rose 8% on bid speculation that a private-equity group will make a takeover bid valued nearly $54 billion. Another pre-market highlight was Ericsson (ERIC: chart)with a $1.4 billion offer for Norway''s Tandberg Television. S&P 500 futures rose 4.4 points at 1,458.20 and Nasdaq 100 futures rose 7.5 points at 1,852.50. Dow industrial futures improved 39 points.


8:45AM Asian markets finished mixed Monday with Japan higher and HK lower.
Asian markets closed mixed on Monday. The Nikkei ended 0.15% higher at 18,215.35. Sony edged 0.8%, after Merrill Lynch upgraded its rating to buy"""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""""" from sell and raised its target price. Softbank gained 3.1%. Resona Holdings fell 2% but shares of Nikko Cordial gained 13% on reports U.S.-based Citigroup Inc. is seeking to substantially boost its 4.9% stake in the company. Sanyo Electric gained 3.9%, following a 21% plunge Friday after the Osaka-based electronics maker announced it was being investigated.

Hong Kong Hang Seng Index fell 0.98% to 20,507.95 and Australian leading share index rose 0.13% to 6,044. In Australia, Rio Tinto led gains among the resources sector after prices for industrial commodities and precious metals rose. Rio Tinto rose 2.1%, while BHP Billiton added 0.5%.

Other benchmarks around the region also gained. South Korea Kospi index closed up 0.15% at 1,470.03 and Taiwan Weighted Price Index closed 1.16% higher at 7,900.20, lifted by gains in construction companies on reports that regional investors are starting to take an active interest in Taiwan real-estate market. China Shanghai Composite Index swung from early losses to jump 1.67%. However, Singapore Straits Times Index fell 0.08% to 3,307.92.