NEW YORK – US stocks ended mostly flat Monday, reversing early gains following a four-day winning streak that had pushed markets to 10-month highs amid hopes of a global economic recovery.
The Dow Jones Industrial Average rose 3.32 points (0.03 percent) to close at 9,509.28, paring a double-digit point gain in early trading.
The tech-heavy Nasdaq composite dipped 2.92 points (0.14 percent) to 2,017.98 while the broad-market Standard & Poor's 500 index fell 0.56 points (0.05 percent) to 1,025.57.
"Stocks today initially seemed poised to continue Friday's rally, but the euphoria faded sometime around midday," said Elizabeth Harrow of Schaeffer's Investment Research.
"Despite last week's stronger-than-expected home sales data, many analysts are now warning that benchmark economic reports have been skewed by government stimulus efforts -- including the tax credit for first-time home buyers, which concludes November 30, and the "Cash for Clunkers" program, which wraps up today," she said.
Wall Street had soared Friday at the end of a four-day rally on growing evidence that the global economic recession is ending. Federal Reserve chief Ben Bernanke, in his clearest signal yet that the global recession will soon be over, said Friday that prospects for growth "appear good" despite financial market strain.
Stock analysts cautioned that the bull run could face sharp corrections, as stocks were now up some 17 percent during the last six weeks despite weak US consumer confidence and rising unemployment clouding recovery prospects.
"The persistent rise in the stock market may be signaling an end to the recession or investors may be whistling past the graveyard," said Paul Nolte, director of investments at Hinsdale Associates.
"We are concerned that investor sentiment is getting bullish and valuations remain very high, but rising prices are begetting rising prices," Nolte said.
Some analysts said the investor fear of missing out on further gains had been fueling stock buying.
"We continue to have reservations about chasing stocks at this point and would urge investor caution in doing so knowing there hasn't been a lot of conviction behind the buying in recent weeks and that economic fundamentals aren't as strong as the stock market would have you believe," said Patrick O'Hare of Briefing.com.
Among stocks in focus, Procter & Gamble slipped 0.45 percent to $53.34 on news that Irish pharmaceuticals group Warner Chilcott has agreed to buy the prescription-drug unit of the US consumer products giant for $3.1 billion.
The deal was expected to close by the end of the year, subject to regulatory approvals, and result in a one-time gain for P&G of $1.4 billion, or 44 cents a share.
Women's apparel retailer Charlotte Russe jumped 25.91 percent to $17.35 after it said it would be acquired by private equity firm Advent International Corp.
Energy stocks also rose on buoyant oil prices fueled by global recovery prospects.
ExxonMobil gained 1.97 percent to $71.30 while Chevron rose 1.48 percent to $70.76.
The bond market advanced. The yield on the 10-year Treasury bond fell to 3.494 percent from 3.556 percent Friday and that on the 30-year bond dropped to 4.288 percent from 4.359 percent. Bond prices and yield move in opposite directions.
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