Bulls keep the rally going

NEW YORK (CNNMoney.com) -- Stocks surged Monday morning, sending the Dow industrials further into record territory as investors welcomed a spate of merger news, including Alcoa's $33 billion bid for rival Alcan.

The Dow Jones industrial average (up 39.82 to 13,304.44, Charts) gained 0.3 percent, briefly touching an intraday record before pulling back a bit. The blue-chip barometer closed at an all-high Friday for the fourth session in a row.

The Dow has now risen in 23 of the last 26 sessions, marking its longest bull run since the summer of 1927, when the indicator ended higher in 24 of 27 sessions, according to Dow Jones.

The broader S&P 500 (up 4.52 to 1,510.14, Charts) index also rose about 0.3 percent, edging ever closer to its all-time high of 1527.46. That record was hit in March 2000 at the tail end of the last rally, fueled by the 1990s tech boom.

The tech-heavy Nasdaq composite (up 5.94 to 2,578.09, Charts) added 0.2 percent, after ending last week at a six-year high.

Stocks have been on a roll lately, thanks to a mix of strong earnings and merger news.

That continued Monday, led by a proposed deal in the aluminum sector.

Dow component Alcoa (up $2.61 to $38.27, Charts, Fortune 500), the world's largest aluminum producer, made a hostile bid for No. 2 rival Alcan (up $20.97 to $82.00, Charts), worth $33 billion in cash and stock. Alcoa shares jumped 7 percent, while Alcan shares jumped nearly 30 percent.

Over the weekend, Armor Holdings (up $4.04 to $86.19, Charts) agreed to be bought by British defense contractor BAE Systems for $4.1 billion.

Meanwhile, Warren Buffett said his Berkshire Hathaway (up $250.00 to $109,500.00, Charts, Fortune 500) is open to making a major $5 billion to $20 billion investment in a "huge" business. (Full story)

Treasury prices rose, lowering the yield on the 10-year note to about 4.64 percent from 4.67 percent late Friday. Treasury prices and yields move in opposite directions.

In currency trading, the dollar slipped against the euro and the yen.

U.S. light crude oil for June delivery fell 72 cents to $61.21 a barrel on the New York Mercantile Exchange.