U.S. Stocks Rise as Tech Shares Rally Amid Debt Vote

Story by Bloomberg

U.S. stocks rose, after benchmark indexes reached five-year highs, as lawmakers voted to temporarily suspend the federal debt limit and technology stocks rallied amid better-than-forecast earnings.

Google Inc. (GOOG) and International Business Machines Corp. (IBM) jumped more than 5 percent after reporting earnings that topped estimates. Advanced Micro Devices Inc. (AMD) surged 11 percent after revenue beat forecasts, helped by sales of chips that run servers. Apple (AAPL) Inc. advanced 1.4 percent before releasing results. Coach Inc., the largest U.S. luxury handbag maker, fell 16 percent after its profit trailed estimates, hurt by lower demand in North America.

The Standard & Poor’s 500 Index gained 0.2 percent to 1,495.41 at 2:49 p.m. in New York. The Dow Jones Industrial Average rose 72.56 points, or 0.5 percent, to 13,784.77. IBM, which accounts for 12 percent of the price-weighted Dow, added 73 points to the 30-stock average. Trading in S&P 500 companies was 8.7 percent above the 30-day average at this time of day.

“The recent theme seems to be early weakness overcome by afternoon buying,” Ryan Larson, the Chicago-based head of U.S. equity trading at RBC Global Asset Management (U.S.) Inc., said in an interview. His firm oversees $250 billion. “Earnings continue to be in focus while the House votes on extending the debt ceiling.”

The U.S. House voted to temporarily suspend the nation’s borrowing limit, removing the debt ceiling for now as a tool for seeking deeper spending cuts. The measure, passed 285-144, lifts the government’s $16.4 trillion borrowing limit until May 19. It goes to the Senate, where Majority Leader Harry Reid said lawmakers will pass the measure unchanged and send it to President Barack Obama.

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