Ventas Inc., which owns senior housing communities, said it would buy Nationwide Health Properties Inc. in a $5.8 billion deal that will create the nation's largest health care real-estate investment trust. Nationwide Health rose 9 percent, while Ventas fell 3 percent.
Australia's Equinox Minerals Limited, a mining company, said it would make a hostile bid to acquire Canada's Lundin Mining Corp. for $4.9 billion in cash and stock. Lundin rose 19 percent while Equinox fell 7 percent. Both trade on the Toronto Stock Exchange.
The deals came just two days after Warren Buffett said in his annual letter to investors that he is "itchy" to make more big acquisitions for his company, Berkshire Hathaway Inc. Berkshire had $38 billion in cash at the end of last year. Its shares rose 2 percent.
Humana Inc. rose 6 percent after the health insurer raised its 2011 earnings forecast for the third time since November. The company also said it regained a contract to provide coverage for 3 million active duty and retired military members and their families in several Southern states.
The Dow Jones industrial average rose 96 points, or 0.8 percent, to 12,226 in morning trading.
The Standard & Poor's 500 index rose 9, or 0.7 percent, at 1,328. The Nasdaq composite index rose 15, or 0.6 percent, at 2,798.
Oil prices stabilized on signs that the disruption of crude oil exports from Libya was easing. Crude fell 98 cents to $96.90 a barrel.
Last week, the Dow fell 2.1 percent after the political turmoil in Libya rattled investors' confidence and sent oil prices soaring. It was the Dow's largest weekly percentage decline since November.
Bond prices rose, pushing their yields lower. The yield on the 10-year Treasury note fell to 3.41 percent from 3.42 percent late Friday.
In economic news, the Commerce Department reported that consumer incomes rose by the largest amount in nearly two years in January, thanks to a tax cut that began last month. Spending rose only 0.2 percent, however, a sign that many people are still uncertain about the economy.
A more closely watched economic update will come later in the week, when the government releases its employment report for January. Economists expect it to show the strongest job growth since May 2010.