Investors had little information to guide them through the session, with few third-quarter earnings reports remaining and no major economic data scheduled this week. News that Microsoft Corp. is in talks to buy a stake in American Online Inc. and a deal involving TiVo Inc. and Yahoo Inc. drove gains in the tech sector.

The market found some comfort in the declining price of crude oil, which sank more than $1 a barrel as recent unusually warm weather quelled fears of a winter heating oil shortage, although the International Energy Agency reiterated concerns about capacity. A barrel of light crude lost $1.11 to settle at $59.47 on the New York Mercantile Exchange.

Bill Groenveld, head trader for vFinance Investments, said he found it surprising the market hasn't withdrawn given the shortage of headlines, which is evidence that a bullish sentiment remains on Wall Street.

"Over the last six months, the market has been through trials and tribulations," Groenveld said. "But it's really coming through with flying colors considering everything it's been up against."

According to preliminary calculations, the Dow Jones industrial average gained 55.47, or 0.53 percent, to 10,586.23, its highest close since Sept. 16.

Broader stock indicators were also higher. The Standard & Poor's 500 index was up 2.67, or 0.22 percent, at 1,222.81, and the Nasdaq composite index advanced 8.81, or 0.41 percent, to 2,178.24.

Bonds rose after reaching eight-month lows last week, with the yield on the 10-year Treasury note sliding to 4.63 percent from 4.67 percent late Friday. The dollar gained ground against most major currencies, while gold prices inched upward.

Today's quiet trading session follows two straight weeks of sturdy gains as investors sifted through quarterly profit reports and mostly positive economic numbers for any indication of the market's direction. Last week, the major indexes each added more than 1 percent.

But even as energy prices continue descending from record levels set in early September, that alone is not enough to boost stocks after the recent rallies, said Arthur Hogan, chief market analyst for Jefferies & Co.

"The three things we'll digest this week are earnings and guidance for the fourth quarter, and the long-term forecast for energy prices," Hogan said, adding that investors will also be watching how companies use stockpiles of cash that have built over the past year.

In corporate news, Guidant said it filed a lawsuit seeking to force Johnson & Johnson to complete a $25.4 billion takeover of Guidant, which has been hurt by recent recalls of some of its implanted medical devices. Last week, Johnson & Johnson warned that negotiations had stalled and might not continue. Guidant sank $1.40 to $57.52, and Johnson & Johnson climbed 55 cents to $61.43.

Microsoft rose 35 cents to $27.01 after The New York Times said the software company has emerged as the front-runner for a stake in Time Warner Inc. unit AOL. Time Warner was unchanged at $17.61.

Yahoo struck a deal to provide its Web content and services through TiVo's television-recording devices, further erasing barriers between media platforms. Yahoo added 3 cents to $37.90, and TiVo jumped 18 cents to $5.30.

Elsewhere in the tech sector, search engine Google Inc. said it is modifying some of its services for use on wireless devices. Yahoo and SBC Communications Inc. are also planning a cell phone that will link Web and wireless offerings. Google gained $4.60 to $395.03, while SBC slipped 25 cents to $23.41.

Dutch market research firm VNU NV said it may drop its planned $7 billion acquisition of healthcare data provider IMS Health Inc. because of opposition from almost half of VNU's shareholders, who say the bid is too high. IMS gained 52 cents to $23.49.

Flyi Inc. added to the airline industry's woes when the firm, which launched low-cost carrier Independence Air a year ago, filed for bankruptcy protection today after struggling with weak demand and high costs. Flyi sank 12 cents to 7 cents.

Advancing issues led decliners by about 9 to 4 on the New York Stock Exchange, where volume of 1.47 billion shares lagged the 1.53 billion shares traded on Friday.

The Russell 2000 index of smaller companies rose 3.08, or 0.47 percent, to 661.24.

Overseas, Japan's Nikkei stock average fell 0.10 percent. Britain's FTSE 100 gained 0.69 percent, Germany's DAX index rose 0.58 percent, and France's CAC-40 was higher by 0.11 percent.