While you were sleeping: UPS, Pfizer deliver results

Wall Street climbed on better-than-expected corporate earnings including from United Parcel Service and Pfizer, while the latest economic reports suggested the US Federal Reserve might hold off an interest rate hike longer than expected.

In late afternoon trading in New York, the Dow Jones Industrial Average gained 1.1%, the Standard & Poor's 500 Index climbed 1.2%, while the Nasdaq Composite Index rose 0.9%.

Gains in shares of Exxon Mobil and those of Chevron, up 4% and 3.8% respectively, led the gains in the Dow.

The Federal Open Market Committee began its two-day meeting, as separate reports showed an unexpected drop in consumer confidence and a lower-than-expected increase in home prices. All eyes are on fresh clues about the timing of a rate hike at the end of the Fed meeting on Wednesday.

"September is possible but the probability for a December rate hike is increasing," Terry Sandven, chief equity strategist at US Bank Wealth Management in Minneapolis, told Reuters. " I think the market has finally factored in that the pace of the increase is more important rather than the timing of it."

The Conference Board's index of consumer attitudes dropped to 90.9 in July, down from a downwardly revised 99.8 in June. It was the weakest reading in 10 months. To be sure, analysts suggested the weakness might be short-lived.

"This seems to be an aberration,"Ryan Sweet, senior economist at Moody's Analytics in West Chester, Pennsylvania, told Reuters. "Consumers were probably freaked out by the problems in Greece and the Chinese stock market, and the volatility on Wall Street."

Separately, the S&P/Case Shiller composite home price index of 20 metropolitan areas rose 4.9% from May 2014, following a 5% increase in the year ended in April.

The data shows "a housing market that's growing quite healthily but isn't overheating," David Sloan, a senior economist at 4Cast in New York, told Bloomberg. That's "probably a fairly good picture as far as the Fed is concerned."

Shares of United Parcel Service gained, last up 5.5%, after the bellwether company reported stronger-than-expected earnings and an optimistic outlook.

"The strong momentum in our international segment is expected to continue and gives us confidence in achieving the upper end of our guidance range," UPS chief executive officer David Abney said in a statement.

Shares of Pfizer climbed, last up 2.7%, after the company posted quarterly profit that exceeded estimates.

Shares of SuperValu soared, last up 16.5%, after the company reported its latest earnings and said it is exploring a spinoff of its Save-A-Lot business, potentially into a stand-alone, publicly traded company.

Fresh M&A activity also buoyed the mood. Shares of Honeywell International advanced, last up 2.7%, after the company agreed to buy Britain's Melrose Industries for about US$5.1 billion.

In Europe, the Stoxx 600 Index finished the session with a 1.1% increase from the previous close. The UK's FTSE 100 Index added 0.8%, France's CAC 40 advanced 1%, while Germany's DAX rallied 1.1%.

(BusinessDesk)