Europe's troubles wear on markets

NEW YORK - Stocks finished mixed Monday as the dollar posted its second day of gains on concerns that Europe is on the edge of another bailout.

Investors believe that Ireland may seek help from its fellow members in the European Union. The dollar also spiked in May when Europe bailed out Greece. Ireland's finances are under strain after the government bailed out five banks after the country's real estate boom collapsed.

The rising value of the dollar, which hurts U.S. exports by making them more expensive to overseas buyers, resulted in stocks paring their gains late in the day. Stocks had risen for most of the day after a spike in dealmaking and news that retail sales in October rose to the highest level in seven months.

Consumer spending rose 1.2 percent last month thanks to higher demand for automobiles, the Commerce Department reported. The gain was nearly double what analysts had been expecting. Shares of Ford Motor Co. rose 4.3 percent after the announcement.

Treasury prices fell after the stronger economic data and a backlash against the Federal Reserve's recent bond-buying program intended to spur the ecnoomy. The price drop sent interest rates to their highest levels in more than three months. Bond yields and prices move in opposite directions.

Caterpillar Inc., the world's largest construction-machinery maker, said it would buy mining-equipment maker Bucyrus International Inc. for $7.6 billion in cash, a 32 percent premium over the company's closing price Friday. Shares of Caterpillar rose 1 percent.

The data-storage company EMC Corp. also said it had reached a deal to buy competitor Isilon Systems Inc. for $2.2 billion in cash. It is offering $33.85 per share, a 29 percent premium over its closing price Friday.

The push for mergers and acquisitions is a good sign for investors, said Uri Landesman, the president of Platinum Partners, a hedge fund in New York City. "It's a statement that companies are moving out from under the bombshells of 2008 and 2009 and that they don't think there will be another disaster," he said.

Corporations are holding record amounts of cash on their balance sheets. Using that cash to buy rivals or to expand into new areas could be a sign that companies are less concerned that the economy might slide back into recession soon.

The Dow Jones industrial average rose 9.39, or 0.1 percent, to close at 11,201.97. It had been up as much as 88 points earlier.

The broader Standard & Poor's 500 index fell 1.46, or 0.1 percent, to 1,197.75, while the technology-focused Nasdaq composite index fell 4.39, or 0.2 percent, to 2,513.82.

Six of the 10 industry groups within the S&P 500 index fell. Companies in the materials industry fell the most, down 0.9 percent. Financial companies had the index's largest gains with a 0.4 percent rise. JPMorgan Chase & Co. gained 1.2 percent to become the top stock among the 30 Dow components.

Shares of retailer Nordstrom Inc. fell slightly in after-hours trading. It nevertheless had reported its third-quarter net income rose 43 percent as its customers continued spending more, topping analyst estimates. It also raised its earnings outlook.