US stocks rose on Tuesday, led by tech shares after the proposed merger of two major semiconductor companies and an updating of a key Nasdaq index attracted buyers to the sector. Investors will scour the minutes from the latest meeting of the Federal Reserve's policy-setting committee, expected at 2 pm (1800 GMT) for insight into officials' views on rising commodity prices and the economic outlook.
Fed Chairman Ben Bernanke said on Monday the price rises were unlikely to persist. A rebalancing of the Nasdaq 100, which takes effect on May 2, spurred traders to buy companies with increased weightings, including Microsoft Corp, Intel Corp and Cisco Systems Inc, all of which rose more than 1 percent and were the top three percentage gainers in the Dow. Apple Inc's weighting was slashed, though it remains the biggest component. The stock was flat after earlier falling as much as 1.5 percent.
The Dow Jones industrial average was up 27.10 points, or 0.22 percent, at 12,427.13. The Standard & Poor's 500 Index was up 4.22 points, or 0.32 percent, at 1,337.09. The Nasdaq Composite Index was up 15.16 points, or 0.54 percent, at 2,804.35. The S&P 500 rose above 1,333, a closely watched level that is double the low it reached in the financial crisis. It hasn't ended above that level since mid-February, and the recent light volume has raised questions about the durability of the rally.