Stocks eased off their best levels in the final minutes of trading Monday but still managed to eke out a small gain, following a sharp rally from the previous week.
The Dow Jones Industrial Average squeezed out a gain of 6.51 points, or 0.05 percent, to close at 13,239.13, led by JPMorgan and AmEx
Meanwhile, BofA led the Dow laggards, suddenly dropping into negative territory following rumors of secondary offering reports (which was later denied). Earlier, the stock topped the $10 a share mark and doubled its most recent multi-year low of $4.92 in mid-December.
The S&P 500 rose 5.58 points, or 0.40 percent, to end at 1,409.75. The S&P is now less than 10 percent below the historic closing high of 1,565.15 in October 2007. The Nasdaq gained 23.06 points, or 0.75 percent, to finish at 3,078.32.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, ended near 15.
Most 10 S&P sectors ended in positive territory, led by banks and techs. Utilities slipped.
“Anytime you have a big runup like this in stocks, there are speed bumps,” said Joe Bell, senior equity analyst at Schaeffer's Investment Research. “But we think any pullbacks are going to be quick consolidations rather than a market top.”
Bell said economic reports are likely to drive market movement going forward, adding that continued improvement in the jobs numbers, consumer sentiment and spending will coax investors to come off the sidelines.
Apple closed above $600 for the first time after the iPad maker announced a quarterly dividendof $2.65 a share and authorized a $10 billion stock repurchase program, which will be executed over three years. The new dividend will be initiated in the fourth quarter of fiscal 2012. Meanwhile, Berenberg boosted its price target to $750 from $445, while Mizuho Securities raised its price target to $700 from $635.
“The news was expected, so it’s not a huge surprise or anything,” said Bell. “But the company deciding to spend cash they’ve built up is a good sign from an economic standpoint.”
Among other mobile device makers, Sprint Nextel tumbled to lead the S&P 500 laggards after Bernstein downgraded the wireless carrier to "underperform" from "market perform," citing bankruptcy risks. And Motorola Solutions was flat after Berenberg raised its price target on the firm to $43 from $38.
U.S. Steel soared to lead the S&P 500 gainers after UBS raised its price target on the steelmaker to $47 from $38. Rivals AK Steel and Nucor also gained.
Meanwhile, Target said it expects its annual dividend to reach $3 a share or more by 2017 and plans to continue buying back shares. And Safeway increased its stock repurchase program by $1 billion and announced a regular quarterly dividend of 14.5 cents a share.
Boeing will be watched after reports that its rival Airbus' wing crack problem may be worse than thought.
On the M&A front, Dutch company TNT Express has accepted a $6.9 billion offer from UPS . Meanwhile, Citigroup raised its price target on rival FedEx to $110 from $95.
And Starbucks will open the first store in its new Evolution Fresh juice bar chain amid hopes the move will boost the company's position in the $50 billion health food sector.
On the economic front, the homebuilder sentiment index was unchanged in Marchat 28, holding its highest level since June 2007, while sentiment in February was revised slightly lower, according to the National Association of Home Builders. Economist had expected a reading of 30.
Major homebuilders including D.R. Horton, Pulte and Lennar turned negative following the report.
Adobe is the only major company slated to post earnings after the closing bell.
—Follow JeeYeon Park on Twitter: @JeeYeonParkCNBC—
Coming Up This Week:
TUESDAY: Housing starts, Bernanke speaks, Fed's Kocherlakota speaks; Earnings from Tiffany, Oracle
WEDNESDAY: Weekly mortgage apps, existing home sale, oil inventories, HP annual mtg, Starbucks annual mtg; Earnings from General Mills, Discover Financial
THURSDAY: Jobless claims, FHFA home price index, leading indicators, Green Mountain Coffee shareholders mtg; Earnings from FedEx, Dollar General, Gamestop, Lululemon, Nike, Accenture
FRIDAY: New home sales, Fed's Lockhart speaks, Fed's Bullard speaks; Earnings from Darden Restaurants
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