NEW YORK (CNN/Money) - The Dow Jones industrial average lost a strong early gain Monday as a weak report on the manufacturing sector took the luster off solid holiday retail sales and an upgrade of technology bellwether Intel.

Around 11:05 a.m. ET, the Dow Jones industrial average (down 24.34 to 8871.75, Charts) retreated after briefly popping above 9,000 for the first time since August. The Nasdaq composite (up 14.68 to 1493.46, Charts) remained positive, although well off its highs, while the Standard & Poor's 500 index (down 0.01 to 936.30, Charts) edged lower.

The Institute for Supply Management said its index of manufacturing activity for November rose to 49.2 from the 48.5 reported for October, but still below the 50 benchmark that signals economic expansion. Revised expectations had been for the index to come in at 51, according to economists surveyed by Briefing.com.

Separately, the government said construction spending rose 0.3 percent in October compared with a revised 0.3 percent increase in September. The report came in better than anticipated, as economists had expected no change in the spending level.

The chip sector started off strong after Lehman Brothers upgraded Intel (INTC: up $0.54 to $21.42, Research, Estimates) to "overweight" from "equal-weight" in a morning note and Merrill Lynch boosted its fourth-quarter revenue and earnings estimates for the No. 1 semiconductor maker. Intel is scheduled to present a mid-quarter update Thursday.

Lehman also raised its investment rating on Intel's competitor Advanced Micro Devices (AMD: up $0.16 to $9.16, Research, Estimates) to "equal-weight" from "underweight," adding that the chip industry could be in the early stages of helping to boost information technology demand. Chip shares rose about 5 percent on average in early trading.

Other blue-chip technology names that also helped the Nasdaq higher included Cisco Systems (CSCO: up $0.15 to $15.07, Research, Estimates), Sun Microsystems (SUNW: down $0.01 to $4.28, Research, Estimates), Dell Computer (DELL: up $0.62 to $29.22, Research, Estimates) and Oracle (ORCL: up $0.13 to $12.28, Research, Estimates).

Helping investors' holiday stock shopping mood was news that retail sales for Friday and Saturday rose about 11 percent. This came despite worries that consumers might pull back this season due to the nation's uncertain economic condition.

The world's No. 1 retailer Wal-Mart Stores (WMT: up $1.20 to $55.10, Research, Estimates) said its "Black Friday" sales set a one-day record. Retailer J.C. Penney (JCP: up $0.67 to $24.40, Research, Estimates) also said its sales on the day after Thanksgiving hit a record.

UAL (UAL: up $0.83 to $3.28, Research, Estimates) shares rose after the parent of United Airlines, in a further effort to avoid bankruptcy, said it would resume talks with mechanics who rejected a $700 million pay cut plan last week.

The broader market lost some of its early steam after some economic news came in slightly below expectations.

Asian-Pacific stocks finished mixed Monday, with Tokyo's Nikkei index down 0.5 percent. Frankfurt led European markets higher in midday trading.

Treasury prices fell early, with the 10-year note yield at 4.32 percent. The dollar strengthened significantly against the yen and also rose against the euro. The strong start to the holiday shopping season propelled the greenback to a one-month high against the European currency.

Brent oil futures rose 11 cents to $25.09 a barrel in London, where gold was slightly lower in early trading.