- Netflix gains as corporate earnings impress
- Pharma M&A activity lifts sentiment
- US housing data slightly ahead of forecasts
Dow Jones: 0.43%
S&P 500: 0.43%
US stocks opened positively on Tuesday on the back of upbeat corporate earnings and an increase in M&A activity.
The Dow Jones Industrial Average and S&P 500
were both 0.4% higher in morning trade, while the Nasdaq rose 0.8%.
Netflix was among the best performers on Wall Street early on after topping forecasts with its first-quarter results following the closing bell on Monday.
United Technologies, Comcast and Lockheed Martin were also on the up after their earnings impressed.
"Corporate earnings season is helping support stock markets right now despite the problems in the Ukraine failing to go away. Earnings season hasn't really been that great so far but once again we're seeing the bar being set very low, making it quite easy for companies to surprise on the upside," said Market Analyst Craig Erlam from Alpari.
Meanwhile, a $47bn takeover offer for Botox maker Allergan and a number of large deals in the global pharmaceutical industry gave stocks in the sector a big boost today.
US firm Pfizer was continuing to make gains on speculation that it could be launching a $100bn bid for British-Swedish peer AstraZeneca. Meanwhile, Swiss group Novartis announced a major three-part deal with GlaxoSmithKline.
In economic news today, existing US home sales fell by 0.2% to 4.59m in March but came in ahead of the 4.56m consensus forecast.
Meanwhile, the US house price index increased by 0.6% in February, up from a revised 0.4% rise the month before and better than the 0.5% increase expected.
The share price of video-streaming service Netflix jumped today after the company beat forecasts and said it would raise subscription prices for new members. Earnings guidance for the second quarter also came in ahead of forecasts.
Botox and breast implants group Allergan surged today after Valeant Pharmaceuticals launched a cash-and-stock bid valuing the company at $152.88 a share, equal to around $47bn.
Activist investor Bill Ackman, who has been building a near-10% stake in Allergan through hedge fund Pershing Square, supported the offer. Ackman said in a statement: "The combination of Valeant and Allergan represents the most strategic and value-creating transaction I have ever analysed."
Eli Lilly also announced today that it would buy Novartis' animal health division for $5.4bn in cash to expand its Elanco unit.
West Texas Intermediate futures were down 1.4% at $102.83 a barrel on the NYMEX.
The yield on a 10-year US Treasury was two basis points higher at 2.74%.