* U.S. home builder sentiment plunges in February
* Coke shares fall after results, drag on Dow industrials
* Forest Labs shares soar; Actavis agrees to buy company
* Dow off 0.2 pct, S&P 500 up 0.1 pct, Nasdaq up 0.7 pct
By Rodrigo Campos
NEW YORK, Feb 18 The S&P 500 and Nasdaq rose on
Tuesday, following Wall Street's biggest weekly gain of the
year, as merger activity increased confidence that there is
value in the stock market even as the benchmark index nears a
The Nasdaq Composite rose for an eighth straight session, a
streak not seen since early July.
Economic reports were disappointing, but following a recent
pattern, soft data was mostly dismissed by the market and blamed
on the weather. U.S. homebuilder confidence suffered its largest
one-month drop ever in February, and the New York Federal
Reserve's gauge of manufacturing was weaker than expected.
"We're going to see weather as a huge brush over a lot of
economic data, mostly if it is related to the consumer," said
Kim Forrest, senior equity research analyst at Fort Pitt Capital
Group in Pittsburgh.
"People don't go out and look at homes in crappy weather."
Forest Laboratories was the S&P 500's best performer
after Actavis said it would acquire the specialty
pharmaceuticals company in a cash-and-stock deal valued at about
"This has everything to do with the changing face of
healthcare and how we pay for it in the United States," Fort
Pitt's Forrest said.
"If there was one big deal, there could be others."
Forest Labs shares soared 27.5 percent to $91.04. Shares of
generic drug makers Teva and Mylan rose on the
news. Teva gained 3.3 percent to $45.67. Mylan shot up 4.8
percent to 48.30 and was the best performer in the Nasdaq 100
The Dow Jones industrial average fell 23.99 points or
0.15 percent, to end at 16,130.40. The S&P 500 gained
2.13 points or 0.12 percent, to finish at 1,840.76. The Nasdaq
Composite added 28.758 points or 0.68 percent, to close
The S&P 500 closed 0.4 percent below its record close hit on
Jan. 15. The small-cap Russell 2000 outperformed the
overall market with a 1.1 percent gain for the day.
Coca-Cola Co reported global sales volumes below
expectations and its stock fell 3.8 percent to $37.47, weighing
on the Dow.
With few obvious justifications for stocks climbing further,
investors are left in the position they were in at the beginning
of the year: unsure about the economy and earnings, but facing
an environment where few other assets offer the same potential
return as the equity market.
After the closing bell, Herbalife shares rose 4
percent after the company posted quarterly results and guidance.
Tesla Motors shares hit an all-time high following
a report that Apple's mergers and acquisitions chief, Adrian
Perica, met Tesla Chief Executive Officer Elon Musk last year,
sparking speculation that Apple could be interested in buying
the electric car maker.
Tesla shares rose 2.8 percent to $203.70 after hitting a
record intraday high of $206. Apple shares edged up 0.4 percent
U.S.-traded shares of BlackBerry Ltd rose 5.3
percent to $9.46. Dan Loeb's Third Point LLC Hedge fund
disclosed a 10-million-share stake in the Canadian company.
Swedish mobile phone game maker King, best known for the hit
Candy Crush Saga, is planning a U.S. stock market debut that
could value it at more than $5 billion and trigger a flurry of
technology company listings.
About 6.2 billion shares traded on U.S. exchanges, below the
7.13 billion average so far in February, according to data from
BATS Global Markets.
Advancing issues outnumbered declining ones on the New York
Stock Exchange by a ratio of 2 to 1. On the Nasdaq, about nine
issues rose for every four that fell.