US stocks dip as Virgin America surges on takeover

New York - Wall Street stocks opened modestly lower on Monday as Virgin America surged more than 40 percent on news it agreed to be acquired by Alaska Airlines in a $4bn deal.

Five minutes into trade, the Dow Jones Industrial Average stood at 17.771.20, down 21.55 points (0.12%).

The broad-based S&P 500 shed 2.76 (0.13%) to 2 070.02, while the tech-rich Nasdaq Composite Index fell 4.93 (0.10%) to 4 909.62.

Virgin jumped 40.0% to $54.47 after Alaska Air Group said it would buy the US arm of Richard Branson's airline at $57 a share, a strong premium over Friday's close of $38.90.

The merger will form a company with combined annual revenues of around $7bn. Alaska Air lost 5.0%.

Key data releases this week include the Institute for Supply Management's reading of the US services sector, as well as minutes from the March Federal Reserve policy meeting.