By Victor Reklaitis, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks ramped higher on Monday,
with the S&P 500 scoring an intraday record, turning positive
for the year and working to achieve a record closing high.
Strategists gave several reasons for the broad rally, including
more M&A activity, an upbeat German confidence report and bets
that the S&P' 500s foray into new high ground could spur
further buying.
The S&P 500 (SPX) rose 20 points, or 1.1%, to 1,857, with
Humana Inc.(HUM) up 9% and performing best in that benchmark index.
The Dow Jones Industrial Average (DJI) rose 186 points, or 1.2%, to
16,289, led by a 3% jump by UnitedHealth Group Inc. (UNH). Shares
in the two health insurers have rallied following a JPMorgan note
saying Medicare Advantage reimbursements will drop less than
expected next year.
The Nasdaq Composite (RIXF) climbed 43 points, or 1%, to 4,306.
The tech-laden index is on pace to nab its highest close since
April 2000.
Follow MarketWatch's markets team live blogging the U.S. stock
market session.
"You had a pretty positive number out of Germany," said Quincy
Krosby, market strategist at Prudential Financial, referring to the
latest Ifo survey on German business confidence.
"The deal flow is also beginning to gain momentum, and that's
very positive for markets," she added.
RF Micro Devices (RFMD) said Monday that it will merge with
TriQuint Semiconductor Inc. (TQNT) in an all-stock deal. RF Micro
was last up 18%, while TriQuint surged 23.5%.
Jos. A. Bank (JOSB) shares rose 8% after Men's Wearhouse Inc.
(MW) upped its offer for its rival to $63.50 a share. The amended
offer is conditioned on Jos. A. Bank terminating its recent
agreement to buy Eddie Bauer. Men's Wearhouse shares rose 7.5%.
Monday's deal news follows other recent M&A events,
including Facebook Inc.'s(FB) purchase of WhatsApp, Comcast
Corp.'s(CMCSA) plan to buy Time Warner Cable Inc.(TWC) and Actavis
PLC's(ACT) agreement to buy Forest Laboratories Inc. (FRX)
Krosby said the announced deals can have a "halo effect,"
spurring some investors to think they're going to see more deals in
other sectors.
Last week, the S&P 500 and Dow both dipped for the week,
halting two-week winning streaks, but that still left the S&P
within striking distance of its Jan. 15 record close of 1,848.38.
The benchmark then jumped above that level on Monday, hitting an
intraday record and turning positive for the year to date.
Some market analysts had said they see limited gains for stocks
in the near term, citing resistance for the S&P 500 as the
benchmark index trades around its record level. But the index
appeared to be punching through any resistance on Monday, spurring
other analysts to predict the move could draw in more buyers in the
short term.
In overseas markets, Asian stocks closed mostly lower on news of
slower growth for Chinese home prices and reductions in real-estate
lending. European shares rallied, boosted in part by Germany's Ifo
business-climate survey coming in slightly better than
expected.
U.S. economic news was on the light side on Monday. Federal
Reserve Chairwoman Janet Yellen is scheduled to appear before a
Senate panel on Thursday, and a fresh estimate on U.S.
fourth-quarter GDP is expected on Friday. Read MarketWatch's
preview for this week's economic reports: Is the economy merely
suffering from a cold?
Among individual U.S. stocks, Netflix Inc. (NFLX) was up 3%,
erasing its early losses, after the company reached an agreement
with Comcast Corp.(CMCSA) in which it will pay Comcast to ensure
smooth viewing for Netflix's video-streaming subscribers in the
U.S.
EBay Inc. (EBAY) climbed 3% as the online auctioneer traded
barbs with activist investor Carl Icahn.
In other markets, gold prices rose, while oil also advanced. The
dollar edged down against its major rivals.
More from MarketWatch:
Market is riding tech M&A wave
Don't try to time the market
How to make money from ETFs' runaway growth
Subscribe to WSJ: http://online.wsj.com?mod=djnwires