NEW YORK — A wave of corporate dealmaking stoked investors’ confidence in the economy and carried stocks sharply higher Monday.
Analyst upgrades of Alcoa Inc. and Intel Corp. and positive momentum on President Barack Obama’s health care overhaul also helped drive a broad advance on the market. Major indexes closed off the day’s highs but still rose about 1 percent. The Dow Jones industrials jumped into the black for the month.
Bond prices tumbled as stocks rose, pushing the yield on the benchmark 10-year Treasury note to its highest level since August. The dollar strengthened, hurting commodities prices.
Stocks got an early boost Monday after French drugmaker Sanofi-Aventis SA announced plans to buy U.S. health-care-products company Chattem Inc. for $1.9 billion, while mining-equipment maker Bucyrus International Inc. said it planned to buy Terex Corp.’s mining-equipment division for $1.3 billion. Dutch automaker Spyker Cars submitted a new offer to buy Saab from General Motors Co.
Robert Pavlik, chief market strategist at Banyan Partners, said the flurry of deal activity is an encouraging sign of economic strength.
“Companies are revealing that they are in a better position financially,” he said. “If they weren’t feeling as confident, you wouldn’t see this type of activity occurring.”
The deals announced Monday follow Exxon Mobil Corp.’s $29 billion takeover of XTO Energy Inc. last week.
The Dow rose 85.25, 0.8 percent, to 10,414.14, after rising as much as 130 points earlier in the day. The Standard & Poor’s 500 index rose 11.58, 1.1 percent, to 1,114.05, and the Nasdaq composite index rose 25.97, 1.2 percent, to 2,237.66.
