Wall Street was higher on Tuesday, helped by gains in healthcare stocks, even as investors awaited monetary policy decisions from the U.S. Federal Reserve and the Bank of Japan.
Though the Fed is not expected to raise rates, Chair Janet Yellen’s speech on Wednesday is keenly awaited for any clues about rate changes in the coming months.
Uncertainty surrounding the Bank of Japan is higher as investors have little idea of what tools it could use to achieve its inflation target.
“Investors have become more comfortable knowing that a Fed rate hike decision will be put off until future meetings, but there is more uncertainty with what Japan will do,” said Paul Springmeyer, investment managing director at the Private Client Group, U.S. Bank in Minneapolis, Minnesota.
Adding to a slew of lackluster economic data, a report on Tuesday showed U.S. housing starts fell more than expected in August as building activity declined broadly after two straight months of solid increases.
“I think (housing data) helps solidify the position for the Fed to hold rates,” Springmeyer said.
A bunch of deals also helped U.S. equities. The healthcare sector provided the biggest boost to the S&P 500 index, following Allergan’s $1.7 billion acquisition, which has the markets speculating about the company’s next deal move.
Tobira Therapeutics stock vaulted more than 700 percent after Allergan agreed to buy the drug developer. Gilead rose 2.6 percent on the news and was the top boost on the S&P and the Nasdaq.
DTS soared 23.2 percent to $42.29 after Tessera Tech agreed to buy the audio equipment maker for $850 million in cash. Tessera’s stock was up 2.7 percent.
At 11:06 a.m. ET (1506 GMT), the Dow Jones Industrial Average was up 66.53 points, or 0.37 percent, at 18,186.7.
The S&P 500 was up 6.61 points, or 0.31 percent, at 2,145.73.
The Nasdaq Composite was up 16.77 points, or 0.32 percent, at 5,251.80.
Ten of the 11 major S&P 500 sectors were trading higher, with consumer staples, a typically defensive part of the market, gaining the most by 0.56 percent.
Marriott International’s shares rose 3.4 percent after receiving antitrust approval from China for the acquisition of Starwood Hotels. Starwood’s shares were up 3.1 percent.
Advancing issues outnumbered decliners on the NYSE by 1,727 to 1,114. On the Nasdaq, 1,580 issues rose and 1,033 fell.
The S&P 500 index showed three new 52-week highs and two new lows, while the Nasdaq recorded 53 new highs and 20 new lows.