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The M&A activity failed to lift the semiconductor sector, however, as more than 50 percent of semiconductor stocks slid. The iShares PHLX Semiconductor Sector Index Fund slipped.
Among the day's earnings, Kellogg fell after the cereal producer's earnings fell shy of expectations, while Time Warner slipped even after the entertainment conglomerate delivered better-than-expected results, thanks to a boost in advertising sales at the entertainment company's cable TV networks.
GM was slated to post earnings before-the-bell Thursday.
April retail sales trends were mixed as signs emerged that rising gas prices were beginning to effect consumer behavior, according to the SpendingPulse report from Mastercard Advisors. Apparel sales rose 10.4 percent in April from a year ago, while e-commerce spending surged 19.2 percent last month from a year earlier.
More news on retail sales is expected when chain-store sales for April are released on Thursday. Analysts expect sales will show a boost Easter's late date.
Commodity trader Glencore set a price range of 480-580 pence per share for its initial public offering. The first day of trading in London will be May 19. The price range values the company at around $61 billion at the mid-point of the range.
Volume on the consolidated tape of the New York Stock Exchange was 4.5 billion shares, whlie 1.1 billion changed hands on the NYSE floor.
In the day's economic news, the Institute for Supply Management's non-manufacturing index fell to 52.8 in April from 57.3 in March. Economists surveyed by Reuters expected the index to remain essentially flat at 57.4.
The ADP Employment Report showed a gain of 179,000 jobs in April, down from a revised gain of 207,000 in March. The March gain was previously reported as 201,000. Economists surveyed by Reuters had expected a gain of 200,000.
And according to another reading of employment, Challenger, Gray & Christmas said employers planned to fire 12 percent fewer employees in April than they did in March, 5 percent fewer than a year ago. The number of job cuts at 36,490 is the lowest total of the year.
Investors are awaiting a key government labor market report due Friday, which is expected to show a rise in overall nonfarm payrolls of 186,000 in April and a gain of 200,000 in private payrolls, according to a Reuters survey.
In Europe, Portuguese bond yields fell after Portugal agreed a three-year 78-billion-euro ($116 billion) bailout with the EU and IMF.