Monday's midday trade: Wall Street rises

US stocks rose on Monday with Wall Street looking to extend three weeks of gains as some investors said shares could rally in a thinly traded, holiday-shortened week. Several companies announced acquisitions. AT&T Inc said it would buy wireless spectrum licenses from Qualcomm Inc in a deal worth $1.9 billion. Qualcomm rose 0.4 percent to $49.64 in premarket trade. AT&T rose 0.2 percent $29.26.
Stocks have rallied strongly this month, with the S&P 500 index up more that 5 percent in December to a two-year high. Some investors say that the market is overbought, however, and could be ripe for profit-taking. "The channel is sideways to higher. The market is clearly bid," said Peter Kenny, managing director at Knight Equity Markets in Jersey City, New Jersey.
The S&P 500 has rallied nearly 19 percent since the end of August and is up 11.6 percent so far this year. Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia, said the trend in stocks was higher but said elevated bullishness and options activity was pointing to a near-term top in equities. "Perhaps we could see a bit of a prick to the euphoria bubble that investors seem to be experiencing," he said.
The Dow Jones industrial average gained 16.27 points, or 0.14 percent, to 11,508.18. The Standard & Poor's 500 Index rose 3.37 points, or 0.27 percent, to 1,247.28. The Nasdaq Composite Index added 8.18 points, or 0.31 percent, to 2,651.15.
US markets will be closed on Friday to observe the Christmas Day holiday the following day. EarthLink Inc said it will acquire One Communications Corp for $370 million, and Raytheon Co will acquire Applied Signal Technology Inc for $490 million. Applied Signal shares rose 7.9 percent to $37.79. EarthLink fell 3.9 percent to $8.64. Underscoring expectations of strong holiday spending, US online sales are up 12 percent to $27.5 billion so far this season compared with a year ago, according to research firm comScore.
Adobe Systems Inc reports quarterly results later in the day. Analysts expect the software maker to earn 52 cents per share, up from 39 cents a year ago. The stock rose 1.5 percent to $29.19. Food and beverage company Sara Lee Corp has been in talks to sell itself to Brazilian meat producer JBS, but the two companies are at odds over price, a source said. Sara Lee shares rose 1 percent to $17.44.