Stock market creeps higher in afternoon trading

NEW YORK (AP) -- Stock indexes hovered near record highs on Monday after a handful of U.S. companies announced deals. Family Dollar's stock jumped following news that investor Carl Icahn has taken a stake in the company.

KEEPING SCORE: The Standard & Poor's 500 index was flat at 1,949, as of 2:52 p.m. Eastern.

The Dow Jones industrial average rose 10 points, or 0.1 percent, to 16,934, while the Nasdaq composite index rose seven points, or 0.2 percent, to 4,328.

With little news to drive trading, the indexes made slight gains early Monday, then slouched back toward the breakeven mark in the afternoon.

On Friday, the S&P 500 index notched its latest record high, its eighth in 10 trading days.

HOW FAR: The market has been on a steady climb for three weeks running, pulling the S&P 500 up 4 percent in a month. Judging by some measures, that sudden success makes it look like the S&P 500 has moved "too far, too fast," said Joe Bell, senior equity analyst at Schaeffer's Investment Research.

But there are still plenty of traders making bets against the market, and people have recently taken billions out of stock funds. Last week, for instance, the Investment Company Institute reported that investors pulled $2.4 billion out of U.S. stock funds in the week ending May 28.

"We don't think there's an overwhelming amount of optimism right now," Bell said.

TYSON WINS: Tyson Foods emerged as the winner in a bidding war for Hillshire Brands, beating an offer by Pilgrim's Pride for the meat-processing company. Tyson raised its offer to $63 a share, topping Pilgrim's Pride's offer of $55 a share. That drove Hillshire's stock up $2.98, or 5 percent, to $61.90. Tyson Foods dropped $2.20, or 5 percent, to $37.92.

MERGER MONDAY: Merck announced a deal to buy Idenix Pharmaceuticals for $3.85 billion, an acquisition that would give the pharmaceutical giant Idenix's array of treatments for hepatitis C. Idenix soared $16.68, or 231 percent, to $23.91.

ICAHN: In a regulatory filing on Friday, Carl Icahn said he and his affiliates have picked up a 9 percent stake in Family Dollar, a discount store, and plan to look for changes to boost the company's value. Family Dollar's stock jumped $8.33, or 13 percent, to $68.86.

APPLE SPLITS: Apple's stock rose $1.43 cents, or nearly 2 percent, to $93.66. That's after closing at of $645.57 on Friday. What happened? The difference reflects Apple's 7-for-1 stock split. Every Apple stockholder received six additional shares for every share they owned. On its own, the split didn't change Apple's market value.

BONDS AND COMMODITIES: In the market for U.S. government bonds, the yield on the 10-year Treasury edged up to 2.61 percent from 2.59 percent late Friday. Yields rise when bond prices fall. The price of oil rose $1.65 to $104.31 a barrel.