NEW YORK (CNNMoney.com) -- Stocks broke into the black Monday afternoon, despite higher oil prices and reports of a North Korea nuclear test, on speculation that Google might buy YouTube.

The Dow Jones Industrial average (up 10.88 to 11,861.09, Charts) rose 0.1 percent with an hour left in the session and were around the record closing high of 11,866.69 set last Thursday. The Dow climbed as high as 11,872.94, eclipsing the record trading high of 11,870.06, which was also set last Thursday.

Of the 30 Dow issues, 17 were lower.

The broader S&P 500 (up 2.56 to 1,352.14, Charts) index rose 0.2 percent while the tech-fueled Nasdaq composite (up 16.75 to 2,316.74, Charts) added 0.7 percent.

All three major gauges were lower earlier in the session after reports that North Korea claimed it conducted a successful underground nuclear test Monday, according to the country's official Korean Central News Agency. (Full story.)

At the same time, light sweet crude oil for November delivery rose 20 cents to $59.96 a barrel on the New York Mercantile Exchange after jumping over a dollar near midday.

Stocks rebounded by the afternoon as investors turned their attention to several key corporate deals in the works. Trading volume, however, remained very light due to the Columbus Day holiday.

"It's a quiet day in the market so I wouldn't necessarily read a lot into (today's) action," cautioned Michelle Clayman, chief investment officer at New Amsterdam Partners.

Google (up $10.54 to $431.04, Charts) rallied nearly 3 percent and gave the Nasdaq a boost on talk that the Web search giant might acquire online video service YouTube Inc.

Cablevision Systems (up $2.44 to $26.37, Charts) jumped 10 percent after the Dolan family that controls the cable operator said it offered to buy the remaining shares it does not already own in a deal that values the company at $7.9 billion.

PNC Financial Services Group (down $3.47 to $70.13, Charts) said it agreed to buy Mercantile Bankshares (up $8.08 to $44.86, Charts) for $6 billion in cash and stock, sending shares of the regional bank down close to 5 percent.

And shares of GlaxoSmithKline (up $0.11 to $54.42, Charts) edged lower after the drugmaker said it's agreed to buy consumer health care product maker CNS (up $8.23 to $36.79, Charts) for $566 million, or $37.50 a share.

In broker action, Mastercard (down $2.49 to $72.66, Charts) sank 3.5 percent after Goldman Sachs and Citicorp both downgraded the credit card company.

Sprint Nextel (down $0.38 to $18.10, Charts) fell 2 percent after the wireless provider was downgraded by UBS to neutral from buy and Verizon (down $0.13 to $36.67, Charts) fell nearly 1 percent after a Citigroup downgrade to sell from hold.

Grocery-store chain Kroger (up $0.41 to $22.90, Charts) was downgraded to "sell" from "neutral" at Banc of America Securities.

On the upside, Citigroup upgraded AT&T (up $0.54 to $32.32, Charts) to buy from hold and Advanced Micro Devices (down $0.43 to $23.58, Charts) was upgraded to neutral from reduce at UBS.

Market breadth was positive. On the New York Stock Exchange, winners beat losers by two to one on volume of 950 million shares. On the Nasdaq, advancers edged out decliners by three to two on volume of 1.2 billion shares.

COMEX gold for December delivery rallied $6 to $582.80 an ounce.

Stocks in Asia fell, with South Korea's main stock index tumbling 2.4 percent and Hong Kong's Hang Seng index losing more than 1 percent. Japan's market was closed for a holiday.

European shares ended mixed.

The dollar reached eight-month highs against Japan's yen.

Treasurys were not trading due to the Columbus Day holiday.

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