* Citigroup to pay $7 bln to settle U.S. mortgage probe
* Shire to accept Abbvie takeover offer
* Indexes up: Dow 0.7 pct, S&P 0.5 pct, Nasdaq 0.6 pct
(Updates to afternoon session)
By Angela Moon
NEW YORK, July 14 U.S. stocks rose on Monday
with the Dow Jones industrial average hitting a new intraday
high, lifted by better than expected earnings from Citigroup and
more deals in the healthcare space.
Boosting investors' confidence that the market is still
attractive to invest, Shire Plc, which sells drugs for rare
diseases, succumbed to an increased 31 billion pound ($53
billion) takeover offer from Abbvie Inc on Monday.
U.S.-listed shares of Shire rose 2.2 percent to
$254.63 while Abbvie shares fell 0.5 percent to $54.71.
Generic drugmaker Mylan Inc said it would buy Abbott
Laboratories' specialty and branded generics business
outside the United States in an all-stock transaction valued at
about $5.3 billion. Mylan shares advanced 2.2 percent to $51.30
while Abbott shares rose 0.8 percent to $41.62.
Citigroup Inc shares rose 3.2 percent to $48.49 as one
of the top boosts to the S&P 500 after it posted second-quarter
earnings and agreed to pay $7 billion to settle a U.S.
government investigation into mortgage-backed securities. The
S&P financial index gained 0.6 percent.
Citigroup is the first major commercial bank to report, and
with today's earnings, the trend seems to be pointing that
financials will have a good earnings season, said Peter
Cardillo, chief market economist at Rockwell Global Capital in
Goldman Sachs analyst David Kostin raised his 2014 target
for the S&P 500 to 2,050 from 1,900, citing expectations that
yields on the 10-year Treasury note around 3 percent will
continue to push investors into stocks for higher returns.
Earnings season will pick up speed this week, with 59 S&P
500 components scheduled to report. S&P 500 profits are
seen growing 6.2 percent in the second quarter, according to
Thomson Reuters data, down from the 8.4 percent growth forecast
at the start of April. Revenue is seen up 3.1 percent.
In order to justify current stock prices, analysts are
looking to earnings to confirm the economy recovered in the
second quarter from the harsh winter.
The Dow Jones industrial average rose 121.37 points
or 0.72 percent, to 17,065.18, the S&P 500 gained 10.29
points or 0.52 percent, to 1,977.86 and the Nasdaq Composite
added 28.41 points or 0.64 percent, to 4,443.90.
The Dow hit a record intraday high of 17,088.43.
Engineering design firm AECOM Technology Corp on
Sunday said it would pay about $4 billion to acquire engineering
and construction services firm URS Corp. URS shares
jumped 11.2 percent to $57.84 and AECOM gained 8 percent to
(Reporting by Angela Moon; Editing by Nick Zieminski)