US STOCKS-Wall St gains as oil pulls back from highs

                                

                                
 * Oil eases from earlier highs
                                
 * Western Digital to buy Hitachi's hard disk operations
                                
 * Indexes: Dow up 0.3 pct, S&P up 0.2 pct, Nasdaq down 0.1
                                
 * For up-to-the-minute market news see [STXNEWS/US]
  (Updates to early trading)
                                
 By Chuck Mikolajczak
                                
 NEW YORK, March 7 (Reuters) - U.S. stocks edged higher on
Monday as a flurry of acquisition activity boosted optimism
about share prices and oil prices eased from earlier highs
sparked by tensions in the Middle East.
                                
 Western Digital Corp <WDC.N> jumped 16.7 percent to $35.02
as the world's No. 2 computer hard drive maker agreed to buy
Hitachi Ltd's <6501.T> hard disk drive operations for about
$4.3 billion in cash and stock. [ID:nL3E7E7163]
                                
 Brent crude <LCOc1> gained 0.8 percent to $116.79 a barrel
after hitting a high of $118.50, while U.S. oil futures were up
0.3 percent to $104.75 as fighting in Libya disrupted the
nation's oil supplies and investors remained concerned about
wider disruptions in the region. For details, see
[ID:nTOPMEAST]
                                
 Government forces struck at rebels in Libya's east and were
reported attacking a town near Tripoli as concern grew over
civilian suffering and a growing refugee exodus.
[ID:nLDE7260G5]
                                
 OPEC is contemplating holding an extraordinary meeting,
Qatar's Energy Minister said, but he added there was no supply
shortage in the market. [ID:nLDE72608C]
                                
 "There is a lot out there, whether it is rising commodity
prices, specifically rising energy prices, the ongoing risk
associated with North Africa, you pick the country, rising
rates on the stage for Trichet and the (European Central
Bank)," said Peter Kenny, managing director at Knight Equity
Markets in Jersey City, New Jersey.
                                
 "There is a lot working against the market at this stage of
the game. Now any gains are going to be hard fought and are
going to really have to be justified. We are well past the easy
sledding."
                                
 The Dow Jones industrial average <.DJI> rose 38.14 points,
or 0.31 percent, at 12,208.02. The Standard & Poor's 500 Index
<.SPX> was up 3.15 points, or 0.24 percent, at 1,324.30. The
Nasdaq Composite Index <.IXIC> dipped 2.93 points, or 0.11
percent, at 2,781.74.
                                
 The S&P 500 has risen nearly 26 percent since the start of
September, but recent trading volumes have been heavier on days
the benchmark index has declined.
                                
 Jean-Claude Trichet said the latest oil spike heightened a
warning he made on inflationary pressures in January, but added
that so far the global economy was set for relatively robust
growth.
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 Leading hedge fund managers raised bets on commodities in
the fourth quarter, moving beyond gold to shares of raw
materials producers. For details, see [ID:nN06220002]
                                
 For other stories, see [ID:nN06220780
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  (Reporting by Chuck Mikolajczak; editing by Jeffrey Benkoe)