Wall Street rises on confidence about "fiscal cliff" talks

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NEW YORK (Reuters) - U.S. stocks added to a surge on Tuesday, bolstered by views that the "fiscal cliff" negotiations were progressing, even as Democrats and Republicans in Congress bantered back and forth.


The gains followed a steep rally on Monday, which lifted the S&P 500 to its highest point in nearly two months.


Republican House Speaker John Boehner said President Barack Obama's most recent offer on taxing the wealthy is "not there yet," but he was hopeful of an agreement to avert steep tax hikes and spending cuts before a December 31 deadline.


Boehner had earlier edged closer to Obama's position on raising taxes on the wealthy while extending tax cuts for other Americans, but gaps remained between the two men's positions. Boehner took the latest negotiating positions before House Republicans and said a vote could come as early as this week.


"As you get more and more clarity and dialogue that there will be a compromise to avoid a fiscal cliff, I think the markets are going to rally," said Weston Boone, vice president of listed trading at Stifel Nicolaus Capital Markets.


"What's holding this market back -- the S&P 500 -- from continuing to reach higher highs is the macro headwinds, and a lot of that emanates from (Washington) D.C."


Investors have been reluctant to make big bets in the face of uncertainty because many fear going over the cliff would push the economy into recession.


The Dow Jones industrial average <.dji> gained 85.62 points, or 0.65 percent, to 13,321.01. The Standard & Poor's 500 Index <.spx> rose 11.77 points, or 0.82 percent, to 1,442.13. The Nasdaq Composite Index <.ixic> added 30.29 points, or 1.01 percent, to 3,040.90.


Tech shares rose, and gains in large-cap technology shares lifted the Nasdaq. Seagate Tech rose 4.2 percent to $29.23 while F5 Networks Inc rose 3.3 percent to $95.64. The S&P Information Technology Index <.gspt> rose 0.88 percent.


Arbitron Inc surged 23 percent to $47.00 after Nielsen Holdings NV agreed to buy the media and marketing research firm in a deal worth $1.26 billion. Nielsen rose 1.9 percent to $30.18.


Baker Hughes Inc said third-quarter margins and revenue would be below its expectations because of lower land drilling activity and price erosion. Shares rose 3.1 percent to $41.91, reversing a decline in the premarket session.


The New York Times said that Wal-Mart Stores Inc's Mexican affiliate routinely used bribes to open stores in desirable locations. The story cited 19 instances of the retail giant paying off local officials. In a statement Monday night, Wal-Mart spokesman David Tovar said the company was looking into the allegations. Wal-Mart shares fell 0.2 percent to $69.07.


(Editing by)



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