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US stocks end mixed after big corporate deals

US stocks finished mixed on Monday (July 28) following prominent corporate deals and a drop in pending home sales as investors looked ahead to fresh earnings and labour market data.

NEW YORK: US stocks finished mixed on Monday (July 28) following prominent corporate deals and a drop in pending home sales as investors looked ahead to fresh earnings and labour market data.

The Dow Jones Industrial Average gained 22.02 points (0.13 per cent) to 16,982.59.

The broad-based S&P 500 rose 0.57 points (0.03 per cent) to 1,978.91, while the tech-rich Nasdaq Composite Index dropped 4.65 points (0.10 per cent) to 4,444.91

Dollar Tree announced a US$9.2 billion deal to acquire fellow discount retailer Family Dollar, while real estate website Zillow announced it was buying rival Trulia in a US$3.5 billion stock deal.

US pending home sales slipped 1.1 per cent in June to 102.7, according to an index by the National Association of Realtors Monday.

Peter Cardillo, chief market economist at Rockwell Global Capital, said investors are avoiding big bets ahead of a busy calendar that includes a Federal Reserve policy decision on Wednesday, Friday's July labour market report and earnings from Pfizer, ExxonMobil and other corporate giants.

"It's just cautiousness ahead of the (Fed) and certainly ahead of the Friday's employment report," he said.

Dow member Microsoft fell 1.2 per cent as it confirmed it was under investigation by antitrust authorities in China. A source familiar with the matter said that some Microsoft offices in China have been raided as part of the investigation, but did not elaborate.

Smith & Wesson dropped 0.7 per cent after the US Securities and Exchange Commission fined the gun manufacturer US$2 million for bribing officials in Indonesia, Pakistan and other countries to gain sales deals.

Tyson Foods jumped 2.6 per cent on plans to divest its Mexican and Brazil poultry businesses to Brazil's giant meatpacker JBS for US$575 million. JBS owns Tyson's US rival Pilgrim's Pride.

Tyson meanwhile announced a 4.4 per cent rise in third-quarter earnings to US$260 million and projected "at least" 10 per cent growth in earnings-per-share in 2015.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.49 per cent from 2.47 per cent on Friday, while the 30-year advanced to 3.26 per cent from 3.24 per cent. Bond prices and yields move inversely.

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