* Citigroup to pay $7 bln to settle U.S. mortgage probe
* Shire to accept AbbVie takeover offer
* Dow up 0.7 pct; S&P 500 up 0.5 pct; Nasdaq up 0.6 pct
(Updates to close)
By Angela Moon
NEW YORK, July 14 U.S. stocks ended higher on
Monday, with the Dow Jones industrial average hitting an
intraday record, lifted by Citigroup's better-than-expected
earnings and more deals in the healthcare space.
Monday's flurry of mergers and acquisitions activity in the
healthcare sector gave investors some confirmation that the U.S.
stock market is still attractive. Shire Plc, which develops and
sells drugs to treat rare diseases, succumbed to an increased
takeover offer of 31 billion pounds($53 billion) from AbbVie Inc
U.S.-listed shares of Shire rose 2.1 percent to
$254.27 while AbbVie shares slipped 0.2 percent to $54.85.
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 2.1 percent to $51.24
while Abbott shares rose 1.3 percent to $41.82.
Citigroup Inc shares jumped 3 percent to $48.42 and
gave the S&P 500 one of its biggest boosts. The stock rallied
after Citigroup reported second-quarter adjusted earnings per
share that exceeded the average analyst estimate 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
The Dow Jones industrial average rose 111.61 points
or 0.66 percent, to end at 17,055.42. The S&P 500 gained
9.53 points or 0.48 percent, to 1,977.10. The Nasdaq Composite
added 24.93 points or 0.56 percent, to 4,440.42.
The Dow hit a record intraday high of 17,088.43.
Goldman Sachs analyst David Kostin raised his 2014 target
for the S&P 500 to 2,050 from 1,900, citing expectations that
the yield on the 10-year U.S. Treasury note at around 3 percent
will keep pushing investors into stocks for higher returns.
Shares of electric car makers also surged on Monday after
China-based electric vehicle maker Kandi Technologies Group
Inc's sales from its joint venture in China more than
tripled in the second quarter from the first quarter.
U.S.-listed shares of Kandi soared 26.6 percent to $18.64
while shares of U.S. electric car maker Tesla climbed
3.9 percent to $226.70.
Earnings season will pick up speed this week, with 59 S&P
500 components scheduled to report. S&P 500 profits are
forecast to grow 6.2 percent in the second quarter from a year
ago, 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 that the economy recovered in the
second quarter from the harsh winter.
About 4.77 billion shares traded on U.S. exchanges, below the
5.35 billion average for the month to date, according to data
from BATS Global Markets.
(Reporting by Angela Moon; Editing by Nick Zieminski and Jan