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US: Stocks rise on reports of big Micron bid


[NEW YORK] Wall Street stocks rose on Tuesday, with the Nasdaq leading the way following reports of a possible US$23 billion acquisition of chipmaker Micron and big gains by Google and others.

The Dow Jones Industrial Average climbed 75.90 points (0.42 per cent) to 18,053.58.

The broad-based S&P 500 advanced 9.35 (0.45 per cent) to 2,108.95, while the tech-rich Nasdaq Composite Index jumped 33.38 (0.66 per cent) to 5,104.89.

Micron Technology surged 11.4 per cent following reports that Tsinghua Unigroup, an investment arm of one of China's leading science and technology universities, plans to offer US$23 billion for the company.

Other chipmakers rose, including SanDisk (+3.4 per cent), STMicroelectronics (+1.2 per cent) and Texas Instruments (+0.9 per cent).

Google climbed 2.7 per cent following a Wall Street Journal report that said the company was curbing hiring and taking a tougher approach to spending under new chief financial officer Ruth Porat. The tech giant will report earnings after the market close on Thursday.

Online retailer Amazon advanced 2.2 per cent following an upgrade by UBS.

Several Nasdaq-listed biotech companies also notched large gains, including Gilead Sciences (+2.5 per cent) and Amgen and Biogen (both +2.3 per cent).

Twitter finished 2.6 per cent higher after spiking more than five percent following a bogus news report about a possible US$31 billion takeover of the microblogging company. The story appeared on a website falsely claiming to be run by Bloomberg, but was quickly denied by the news agency.

Banking giant and Dow member JPMorgan Chase climbed 1.4 per cent after second-quarter earnings rose 5.2 per cent to US$6.3 billion. Wells Fargo advanced 0.9 per cent on flat earnings of US$5.7 billion.

Johnson & Johnson, another Dow component, fell 0.5 per cent as second-quarter sales dropped 8.8 per cent to US$17.78 billion, due in large part to the effects of the strong dollar.

Discount carrier Spirit Airlines shed 7.4 per cent after estimating that second-quarter results would be hit by US$20 million in costs from canceling about 500 US flights due to bad weather. Spirit also lowered its full-year forecast due to stronger price competition.

Bond prices rose. The yield on the 10-year US Treasury dipped to 2.40 per cent from 2.44 per cent Monday, while the 30-year dropped to 3.20 per cent from 3.22 per cent. Bond prices and yields move inversely.