While you were sleeping: S&P 500 hits 5-month high

Wall Street advanced, pushing the S&P 500 to a five-month high, as better-than-expected corporate earnings including from Discover Financial Services and a rebound in the price of oil underpinned sentiment.

Shares of Discover Financial Services soared, up 7.3 percent in 2.36pm trading in New York, after the credit card company reported a first-quarter profit that surpassed expectations.

Yahoo shares also jumped, last up 4.6 percent, after CEO Marissa Mayer reassured analysts the company was concentrating on finding a potential buyer for its internet operations. 

“Our efforts to date reflect clear, decisive action to move forward quickly and in a way that we believe will yield enhanced value,” Mayer said, Bloomberg reported. “I personally believe that the right transaction could unlock tremendous value.”

Yahoo marginally beat estimates with its quarterly earnings. 

"The numbers are providing some comfort things aren't falling off a cliff," Ronald Josey of JMP Securities, told Reuters. "If you're bidding for this company it's nice to see them doing what they said they would do."

Shares of Lexmark climbed, last up 9.5 percent, after the company said it had agreed to be taken private by a group of investors led by China-based Apex Technology Co and PAG Asia Capital in an all-cash transaction valued at about US$3.6 billion.

Wall Street rose. In 2.24pm New York trading, the Dow Jones Industrial Average rose 0.6 percent, while the Nasdaq Composite Index gained 0.3 percent. In 2.10pm trading, the Standard & Poor’s 500 Index advanced 0.5 percent.

Gains in shares of UnitedHealth and those of American Express, up 3 percent and 2.2 percent respectively, led the Dow higher.

"The momentum is still skewed to the positive despite the earnings data and some of the mixed economic data," Anthony Valeri, an investment strategist for LPL Financial in San Diego, told Reuters.

Meanwhile, shares of Coca-Cola posted the biggest drop in the Dow in afternoon trading, 4.1 percent weaker. While the company reported quarterly results that were in line with expectations, investors were concerned about the outlook. 

“The penny beat on the bottom line is perhaps not as encouraging as one might expect, because you’ve got some softness on the top line,” Vivien Azer, an analyst at Cowen & Co, told Bloomberg. “We view soda as the new cigarette, which would result in that category, and Coke in particular, realising structural volume declines from here on out.”

There was good news on the US housing sector front. Existing home sales jumped a better-than-expected 5.1 percent to an annual rate of 5.33 million units last month, a National Association of Realtors report showed. 

"Closings came back in force last month as a greater number of buyers – mostly in the Northeast and Midwest – overcame depressed inventory levels and steady price growth to close on a home," Lawrence Yun, NAR chief economist, said in a statement. 

“Buyer demand remains sturdy in most areas this spring and the mid-priced market is doing quite well,” Yun noted. “However, sales are softer both at the very low and very high ends of the market because of supply limitations and affordability pressures."

Oil climbed 3 percent after a report showed US inventories increased less than expected last week. Crude production dropped to 8.95 million a day in the week ended April 15, the lowest since October 2014, according to Energy Information Administration data.

In Europe, the Stoxx 600 Index ended the session with a 0.4 percent gain from the previous close.

(BusinessDesk)