Stocks finished mostly higher Monday amid a continued outbreak of takeover fever, sending the Dow Jones industrial average past 13,300 for the first time and to yet another record close.
Technology shares, however, were depressed by pullbacks in Yahoo and Santa Monica-based Activision.
Blue-chip issues were buoyed by a $27-billion bid by Alcoa for Canadian aluminum rival Alcan and by an agreement by London-based defense contractor BAE Systems to acquire Armor Holdings, a maker of military vehicles and bulletproof vests, for $4.1 billion.
Berkshire Hathaway's Warren Buffett bolstered speculation that acquisitions would accelerate their record pace, saying Sunday that he would spend as much as $60 billion for the right deal.
Announced U.S. mergers and acquisitions so far this year total $913 billion, 59% ahead of last year's record pace.
"We're going to continue to see a fair amount of merger and acquisition activity given the amount of global liquidity that exists out there and the fact that interest rates are still relatively low," said Gordon Fowler, chief investment officer at Glenmede Investment Management in Philadelphia.
The Dow industrials rose 48.35 points, or 0.4%, to 13,312.97. The index touched 13,317.69 during the session, topping a previous trading high of 13,284.53 set Friday.
The blue-chip index has hit 20 record closes since the start of the year and 42 since the beginning of October.
The Standard & Poor's 500 index rose 3.86 points, or 0.3%, to 1,509.48. Last week, the S&P 500 moved above 1,500 for the first time in nearly seven years and within sight of the gauge's record close of 1,527.46 reached March 24, 2000.
The Nasdaq composite index edged down 1.20 points to 2,570.95. The Russell 2,000 index of smaller companies slipped 1.01, or 0.1%, to 831.87.
Advancing issues outnumbered decliners by about 9 to 7 on the New York Stock Exchange.
Bonds were little changed after an auction of $14 billion of 3-year notes. The yield on the benchmark 10-year Treasury note fell to 4.63% from 4.64% late Friday.
The dollar fell against the yen and the euro, while gold prices inched up.
Crude oil futures fell 46 cents to $61.47 a barrel on the New York Mercantile Exchange.
In the big takeover offer of the day, Alcoa's cash and stock offer valued Alcan at a premium of 20% over Alcan's market price, based on Friday's closing prices.
Alcoa, one of the 30 stocks in the Dow industrial average, rose $2.97, or 8.3%, on Monday to $38.63, while Alcan surged $21.08, or 35%, to $82.11.
Under its deal for Armor, BAE, Europe's biggest military contractor, would pay $88 a share, 24% more than Armor's price before the stock began a three-day rise last week. Armor rose $4.45, or 5.4%, on Monday to $86.60, while BAE rose 3 cents to $11.36.
In other market highlights:
* Clear Channel Communications climbed 95 cents to $37.30 after the largest U.S. radio broadcaster said it was considering a sweetened bid from private equity investors led by Bain Capital and Thomas H. Lee Partners for $39.20 a share, or $19.5 billion.
* Liberty Mutual Group, the sixth-largest U.S. property and casualty insurer, said it agreed to buy competitor Ohio Casualty for $2.7 billion in cash, or $44 a share. Ohio Casualty soared $9.85, or 30%, to $43.17. Boston-based Liberty Mutual is closely held.
* Wendy's International jumped on speculation that the third-largest U.S. hamburger chain received a takeover bid. The stock climbed $1.52, or 4%, to $39.75.
* Activision slumped $1.10, or 5.2%, to $20.17. Banc of America Securities said it might lower its forecast for sales of the company's "Spider-Man 3" video game because of disappointing reviews.
* Yahoo slid 60 cents, or 1.9%, to $30.38, giving back some of a 9.9% rally Friday that was prompted by speculation that Microsoft wanted to buy the company. People briefed on the companies' discussions said the talks were in an early stage and focused on a partnership rather than an acquisition. Microsoft gained 15 cents to $30.71.
* Hansen Natural fell $1.10, or 2.8%, to $40.42 after the beverage maker reported lower-than-expected first-quarter sales and higher costs.
* Peerless Manufacturing, which makes air filters for oil refineries and shipbuilders, rose $1.99, or 5.5%, to $38 after its fiscal third-quarter profit rose 7%.
* Darden Restaurants climbed $2.29, or 5%, to $45.51 after a Bear Stearns analyst raised his rating on the operator of the Red Lobster and Olive Garden chains following the company's decision to sell its barbecue restaurants.
* Overseas, key indexes rose 1.6% in Japan, 0.1% in Germany and less than 0.1% in France. Stock markets in Britain were closed for a bank holiday.