Dow, S&P 500 close at 5-year highs
U.S. stocks rose Tuesday, sending the Dow and the S&P 500 index to new five-year highs.
Moving the markets was talk of a merger between Office Depot Inc. and OfficeMax Inc. A person familiar with the matter said the companies have discussed a merger and may announce a deal as early as this week.
U.S. markets were closed Monday for the Presidents Day holiday.
The S&P 500 completed its seventh consecutive weekly advance on Feb. 15, climbing 0.1 percent for the five days amid optimism over corporate merger activity and better-than- estimated economic data. The benchmark gauge is just below its 2007 all-time high of 1,565.15, while the Dow is close to its record high of 14,164.53.
"More deals out there do create a good sentiment," said chief investment officer Kevin Divney at Beaconcrest Capital Management in Boston in a phone interview. "It's a positive now because CEOs now are looking further out, and that's been the issue the past four years. If we can extend horizons it makes for better strategic decisions."
Almost $40 billion in deals were announced in the U.S. on Feb. 14, bringing the total this month to more than $140 billion, according to data compiled by Bloomberg. That already surpassed the total of $99.6 billion during the first two months of 2012.
The S&P 500 has climbed 7.1 percent in 2013 as U.S. lawmakers agreed on a compromise federal budget and earnings topped analyst estimates. About 71 percent of the 400 companies in the S&P 500 that have released results in the earnings season have exceeded profit projections, and 66 percent have beaten sales estimates, data compiled by Bloomberg show. Dell Inc. and Marriott International Inc. are among 14 companies on the equity benchmark that will report their earnings Tuesday.