US shares climbed, with blue-chip indexes almost hitting record levels against the background of merger and acquisition activity and earnings reports. European bonds surged on positive sentiment a debt problem is resolved, while the dollar strengthened.
In New York, the Standard & Poor’s Index added 0.4% at 12:15 pm, five points lower than an all-time peak. Intel Corp approached its biggest gain in three years on earnings report. Time Warner Inc. soared after it received a takeover offer from Century Fox Inc.
Federal Reserve Chair Yellen said equities valuations overall were in harmony with historical trends after a central bank report on Tuesday showed prices for smaller social-networking and biotechnology firms are significantly exaggerated.
Apple Inc. and International Business Machines Corp rallied after announcing a deal. US industrial output advanced last month to close the best-performing three-month period in about four years.
“I think Yellen might have derailed a few things yesterday, but today it’s back to earnings again and rightfully so. “Earnings season is a big deal and you have a couple of big names that have looked good with many, many to come,” Richard Sichel of Philadelphia Trust Co. told Bloomberg in a phone interview.
Fourteen firms in the S&P 500 index including BlackRock Inc. and EBay Inc. are expected to announce earnings results on Wednesday. An analyst survey by Bloomberg showed that companies in the equities index likely saw profits jump 3.1% in the quarter that ended June 30, while sales added 3.1%.
Intel increased 7.3% after the world’s most dominant manufacturer of semiconductors projected third-quarter sales that beat analysts’ outlook.
According to ABCNews, the Dow Jones Industrial Average ascended 63 points or 0.4% to 17, 124 by 1:22 pm Eastern time.
Bank of America plunged 29 cents or 1.8% to $15.52 after announcing second-quarter earnings that took a hit from higher lawsuit fees.
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