U.S. stocks finished mostly higher on Tuesday, with the Nasdaq Composite rising for an eighth session, as investors considered a large acquisition and partially disregarded downbeat economic reports as impacted by the weather.
Forest Laboratories jumped after Actavis agreed to acquire the Alzheimer's drug maker. Coca-Cola declined after reporting a drop in fourth-quarter profit.Shares of Tesla Motors climbed to a record after a report that Apple might be interested in buying the electric car maker.
A measure of home builder confidence fell dramatically in February as dismal weather hit sales. Shares of PulteGroup and D.R. Horton were among those in decline after the release of the report.
And, the New York Fed's "Empire State" general business conditions index had factory activity in New York, the upper part of New Jersey and lower portion of Connecticut slowing in February, coming in at 4.48 in February from 12.5 in January. Economists polled by Reuters expected a reading of 9.0.
"There is little doubt that weather has affected the U.S. economic data and economic momentum has waned, but the extent of each remains a question," Bill Stone, chief investment strategist at PNC Asset Management Group, wrote in an emailed note.
(Read more: Traders to shovel through data in hunt for real economy)
Major U.S. Indexes
After a three-day holiday weekend, the Dow Jones Industrial Average fell 23.99 points, or 0.2 percent, to 16,130.40, with Coca-Cola shares leading blue-chip losses.
The rose 2.13 points, or 0.1 percent, to 1,840.76, with health care the best performing and telecommunications faring worst among its 10 major sectors.
Rising to a 13-year high and up for an eighth session straight, its longest win streak since July, the Nasdaq added 28.76 points, or 0.7 percent, to 4,272.78.
Advancers outdid decliners by roughly 2 to 1 on the New York Stock Exchange, where 722 million shares traded. Composite volume reach 3.4 billion.
The dollar fell against the currencies of major U.S. trading partners and the yield on the 10-year Treasury note used in figuring consumer loans fell 4 basis points to 2.709 percent.
Gold futures for April delivery rose $5.80, or 0.4 percent, to $1,324.40 an ounce; crude-oil futures for April delivery climbed $2.13, or 2.1 percent, to $102.43 a barrel.
The stock market was closed Monday for the President's Day holiday.
The Federal Reserve on Wednesday releases minutes from its January meeting, at which the makers of U.S. monetary policy opted to cut another $10 billion from the central bank's monthly asset purchases. Equities last week notched a second week of gains after Fed Chair Janet Yellen indicated she would continue former Fed Chairman Ben Bernanke's policies.
—By CNBC's Kate Gibson
Coming Up This Week:
Wednesday:
Earnings: Anglogold Ashanti, Devon Energy, Host Hotels, MGM Mirage, Omnicare, Carlyle Group, Iamgold, Marriott, Safeway, Tesla Motors, Sunoco Logistics Partners, Williams Cos., Jack in the Box, Curtiss-Wright, Costar Group, Flowserve, Healthsouth
830 a.m.: PPI
8:30 a.m.: Housing starts
12:15 p.m.: Atlanta Fed President Dennis Lockhart
1:00 p.m.: St. Louis Fed President James Bullard
2:00 p.m.: FOMC minutes
7:00 p.m.: San Francisco Fed President John Williams
Thursday:
Earnings: Wal-Mart, Hewlett-Packard, DirecTV, Nordstrom, Priceline.com, Groupon, Cabot Oil and Gas, Allscripts Healthcare, intuit, Newmont mining, Aruba Networks, Public Storage, Mohawk, Marvel Tech., Federal-Mogul, Tim Hortons, Imax, TransCanada, Cedar Fair, Scana, Sonus, Scana, Dana Holding
8:30 a.m.: Initial jobless claims
8:30 a.m.: CPI
8:58 a.m.: Manufacturing PMI
10:00 a.m.: Philadelphia Fed survey
10:00 a.m.: Leading indicators
Friday:
Earnings: Dish Networks, Charter Communications, Echostar, Graham Holdings, Eldorado Gold, Starz, Agrium, Pinnacle West
10:00 a.m.: Existing home sales
12:10 p.m.: St. Louis Fed's Bullard
1:45 p.m.: Dallas Fed President Richard Fisher
Saturday
G20 financial ministers in Australia
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