Wall Street rallied sharply on Monday, juiced by a jump in Apple shares and gains from energy stocks that were backed by stronger oil prices.
The three major U.S. indexes each were up more than 1 percent in afternoon trade.
Apple (AAPL.O) shares were up 3.9 percent after Warren Buffett's Berkshire Hathaway (BRKa.N) reported a stake worth about $1 billion in the iPhone maker. The stock, which had lost about one-fifth of its value in the past month, gave the biggest boost to the three indexes.
The S&P energy sector .SPNY was the best-performing group as oil prices hit six-month highs. Crude prices were supported by worries about global supply outages and as long-time bear Goldman Sachs sounded more positive on the market.
Oil prices have recovered some ground after touching 12-year lows earlier in 2016, with volatility in oil causing jitters in other markets.
“With oil prices being back up into that $40 range, some of the downside that was associated with the energy market ... is more subdued at these current prices, or at least held at bay, and the ripple effects from that are also held at bay," said Jason Pride, director of investment strategy at Glenmede Investment and Wealth Management in Philadelphia.
The Dow Jones industrial average .DJI was up 202.09 points, or 1.15 percent, to 17,737.41, the S&P 500 .SPX had gained 22.95 points, or 1.12 percent, to 2,069.56 and the Nasdaq Composite .IXIC had added 65.15 points, or 1.38 percent, to 4,782.83.
Nine of the 10 major S&P 500 sectors were higher.
Last week, the Dow and S&P 500 fell for a third straight week, while the Nasdaq's losing streak hit four weeks.
Gloomy quarterly reports from retailers had clouded the market last week. The retail sector is in focus again, with Wal-Mart (WMT.N), Home Depot (HD.N) and Target (TGT.N) set to report results this week.
The S&P 500 is up more than 1 percent this year. While the benchmark index has risen about 14 percent since February lows, the rally fizzled out in the last few weeks amid mixed corporate earnings and economic data.
On Monday, Anacor Pharmaceuticals (ANAC.O) soared 55.4 percent to $99.52 after Pfizer (PFE.N) said it would buy the drugmaker in a deal valued at $5.2 billion. Anacor gave one of the biggest boosts to the Nasdaq Biotechnology index .NBI, which gained 2.6 percent.
Tribune Publishing (TPUB.N) was up 23.4 percent at $14.15 after Gannett (GCI.N) raised its buyout offer to $15 per share. Gannett was up 2.6 percent at $16.03.
Advancing issues outnumbered declining ones on the NYSE by 2,416 to 581, for a 4.16-to-1 ratio on the upside; on the Nasdaq, 2,033 issues rose and 774 fell for a 2.63-to-1 ratio favoring advancers.
The S&P 500 posted 17 new 52-week highs and 3 new lows; the Nasdaq recorded 38 new highs and 51 new lows.
(Additional reporting by Tanya Agrawal and Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)
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Published Date: May 17, 2016 00:30 AM | Updated Date: May 17, 2016 00:30 AM