S&P pares gains to close below 2,000

The New York Stock Exchange in New York The New York Stock Exchange in New York on Aug. 19, 2013. Global stock markets were mostly higher Monday after top central bankers in Europe and Japan said support for their economies would continue and additional help is possible. Photo Credit: AP

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Financial markets rose Monday, briefly sending the Standard & Poor's 500 index above 2,000 for the first time, as corporate deal making and prospects for economic stimulus bolstered confidence in the bull market.

At the close on Wall Street, the S&P 500 closed up 0.5 percent at nearly 1,998, paring gains in the afternoon after holding above 2,000 for less than two hours and reaching a record 2,001.95. The Dow Jones industrial average closed up 75.7 points, or 0.4 percent, at 17,077.

"This number, 2,000, is a pretty significant number from psychological and financial points," Joe Bell, senior equity analyst at Cincinnati-based Schaeffer's Investment Research Inc., said in a phone interview. "Perhaps we might reach a little bit overbought status, and it looks like the index is going to take a breather there."

The S&P 500 has risen almost 100 points since its low during trading on Aug. 7, climbing on nine of 12 days to erase the 3.9 percent drop that began on July 24. The U.S. equity benchmark has advanced for the past three weeks and more than $900 billion has been added to the value of American equities.

HOUSING STUMBLE: The U.S. Commerce Department said sales of new U.S. homes slid 2.4 percent last month to a seasonally adjusted annual rate of 412,000. That's down from an upwardly revised June rate. New home sales have struggled to gain traction this year, held back by modest wage growth, a bump in mortgage rates and rising home prices. Several home builder stocks turned lower after the report came out at 10 a.m. Eastern time, led by Taylor Morrison Home with a decline of 26 cents, or 1.2 percent, to $20.16.

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DEAL BOOST: Shares in InterMune vaulted 35.4 percent, closing up $19.05 at $72.85, on news that the California biotech company agreed to sell itself to Swiss pharmaceutical company Roche for $8.3 billion. The deal was announced Sunday.

UNDER PRESSURE: A big shareholder in Ann Inc., the parent company of Ann Taylor and Loft clothing chains, is putting public pressure on management to explore selling the company. The campaign drove Ann shares up $2.42, or 6.5 percent, to $39.94.

DONUT KING? Burger King gained $5.29, or 19.5 percent, to close at $32.40 on news the fast-food chain is in talks to acquire doughnut chain Tim Hortons and create a new holding company headquartered in Canada, a move that could shave its tax bill.

Reports from Bloomberg News and The Associated Press were used in this story.

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