NEW YORK (CNN/Money) -
U.S. stocks eased Monday as investors watched the volatile dollar and saw few broad market implications from a $4 billion technology merger.
The Nasdaq Composite (down 3.44 to 2060.57, Charts), Standard & Poor's 500 (down 2.95 to 1139.81, Charts) and the Dow Jones industrial average (down 14.00 to 10579.03, Charts) all inched lower Monday.
Elsewhere, trading of stocks and Exchange Traded Funds (ETFs) on the American Stock Exchange was delayed and resumed at 12:30 p.m. ET as a result of a communications problem, according to an AMEX spokesman.
"It's surprisingly quiet, which is a good thing after Friday's rally," said Ned Riley, chief investment strategist with State Street Global Advisors. "If you look at the mutual fund inflows, there's money coming into the market and demand is still strong."
Stocks climbed sharply Friday as investors took a weaker-than-expected unemployment report as a sign that the Federal Reserve will take more time to raise interest rates.
Monday's flat results after Friday's jobs report and subsequent rally underscore the perception of an economy that's not too hot and not too cold, which some market players see as a good investing climate.
The dollar came under pressure after U.S. Treasury Secretary John Snow said over the weekend that the G7 finance ministers' meeting in Florida resulted in an agreement to maintain flexible exchange rates, despite growing calls from some countries to check the continuing slide of the dollar against the euro and the Japanese yen. The dollar fell to a two-week low versus the euro following Snow's comments.
The talk on the dollar left some market participants wondering if the continuing slide could put pressure on dollar-denominated securities.
"The question coming out of the meeting is, is [the dollar's slide] going to continue and will foreign investors start pulling out of stocks and bonds because of the weak dollar," said Hugh Johnson, chief investment office with First Albany. "Most people don't think this will happen, but the G7 meeting raised that concern a little."
However, the greenback bounced back late Monday after a published report said European Union finance ministers will discuss "all possible ways" to curb the euro's gains, raising the prospect of possible dollar buying.
Johnson also said the heating presidential election campaign is an underlying concern for some investors. In a weekend interview, President Bush defended his decision to go to war in Iraq, even though no weapons of mass destruction have been found there. Meanwhile, Massachusetts Sen. John Kerry won another three primaries over the weekend.
"The markets are getting a little nervous," Johnson said. "On balance, investors want to see this president and the tax cuts preserved."
Market breadth was positive and volume was light. On the New York Stock Exchange, where 1.3 billion shares changed hands, advancers beat decliners by six to five. On the Nasdaq, gainers outnumbered losers also by six to five as 1.7 billion shares traded.
Here's what was moving in the market prior to the close:
Monday's movers
With the fourth-quarter earnings season winding down, investors focused on other corporate news in what was a relatively slow start to the week.
Stocks moving Monday included NetScreen Technologies (NSCN: up $9.54 to $35.94, Research, Estimates), which jumped 36 percent after agreeing to be bought by Juniper Networks (JNPR: down $3.29 to $26.18, Research, Estimates) $4 billion. Juniper's stock sank nearly 11 percent.
Other noteworthy tech stocks on the move included PeopleSoft (PSFT: down $0.53 to $22.22, Research, Estimates), which lost about 2 percent after the software firmrejected the latest raised bid from Oracle (ORCL: down $0.14 to $13.28, Research, Estimates).
The week will see little economic news until Thursday when readings on initial jobless claims, retail sales and business inventories are released.
Media conglomerate Viacom (VIA: down $0.27 to $40.39, Research, Estimates) and hotel chain Marriott (HMT: down $0.15 to $12.80, Research, Estimates) are among the companies scheduled to release their quarterly results before the opening bell Tuesday.
Treasury bond prices rose, with the yield on the 10-year note falling to 4.06 percent. NYMEX light sweet crude oil gained 15 cents to $32.63 a barrel. COMEX gold gained $3.20 to $407.40 an ounce.
Stock markets in Asia climbed overnight and most European bourses closed higher .
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