U.S. stocks advanced on Tuesday, led by gains from oil and materials companies, while an uptick in M&A activity spurred recovery hopes, making equities more appealing to investors.
Energy shares led the S&P 500 index higher as oil futures rose 4.8 percent to $71.30 a barrel thanks to a weak dollar.
Kraft Foods Inc
The news of the rebuff sent Kraft shares down 5.9 percent to $26.45, but speculation about potential suitors for Cadbury buoyed the overall market sentiment. For details, see
The M&A news was very supportive to the market, said Bruce Bittles, chief investment strategist at Robert W. Baird & Co in Nashville, Tennessee.
Ever since the market's big rally, a lot of folks have been concerned about valuations. But when you see a bid like this, it eases those fears.
The Dow Jones industrial average <.DJI> was up 40.81 points, or 0.43 percent, at 9,482.08. The Standard & Poor's 500 Index <.SPX> gained 7.27 points, or 0.72 percent, at 1,023.67. The Nasdaq Composite Index <.IXIC> rose 11.74 points, or 0.58 percent, at 2,030.52.
The Kraft bid comes after France Telecom
Although Kraft's stock fell, other food companies rose, including Hershey Co
In the oil sector, Chevron Corp
Freeport-McMoRan Copper & Gold Inc
Health insurance stocks <.HMO> slid 1.5 percent before U.S. President Barack Obama's address to Congress on Wednesday. He is expected to outline his proposed revamp of the healthcare system.
Shares of General Electric Co
On the Nasdaq, shares of iPod maker Apple Inc
(Editing by Kenneth Barry)