Sectors linked with economic growth led the way higher as their recently beaten-down prices made them attractive to bargain hunters. The S&P financial sector index rose 1.6 percent. Bank of America gained 3.5 percent to $8.84.
On Tuesday, the S&P 500 closed below its 50-day moving average for the first time since December, and on Wednesday the level provided technical resistance to its rebound. The S&P's 50-day moving average is now near 1,373, close to today's session high.
Alcoa Inc shares rose 7.7 percent to $10.03 a day after the Dow component reported a first-quarter profit instead of a loss that Wall Street was expecting, easing concerns about a weak earnings season.
"Expectations have been running very low, so the optimistic start to earnings season is a very welcome sign," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. "That said, we're going to get a broad sense of how industries are faring this week, and we may trade sideways until we get that."
Google Inc, JPMorgan Chase & Co and Citigroup Inc are among the companies slated to report later this week.
The Dow Jones industrial average was up 111.94 points, or 0.88 percent, at 12,827.87. The Standard & Poor's 500 Index was up 12.88 points, or 0.95 percent, at 1,371.47. The Nasdaq Composite Index was up 28.07 points, or 0.94 percent, at 3,019.29.
Tuesday marked the S&P 500's largest daily percentage drop in four months. Investors will evaluate if the slide presents a buying opportunity for those who missed the market's gains in the first three months of the year.
The economy kept growing moderately in the late winter months, although rising gas prices were beginning to worry producers and consumers across the country, the Federal Reserve said in its latest "Beige Book" summary of national activity. This assessment had little impact on equities.
European Central Bank Executive Board member Benoit Coeure, calming fears about the euro zone, said on Wednesday the central bank still had the Securities Market Program (SMP) in place allowing it to purchase the debt of euro-zone nations, should the need arise.
Glass container maker Owens Illinois was the S&P 500's largest gainer a day after the company said it expects a 35 percent rise in its first-quarter profit. In Wednesday's session by midday, the stock was up 7.1 percent at $23.57 after earlier touching a session high at $24.47.
In contrast, the U.S.-listed shares of Nokia tumbled 14 percent to $4.33 after the mobile phone maker warned its phone business would post losses in the first two quarters this year, as it struggles to revamp its product line.
Bearish analysts see more declines ahead as a result of an overextended market that has lost its footing as the euro zone's debt crisis resurfaces and economic indicators soften.
Investors have an eye on developments in Indonesia after a massive earthquake and aftershocks struck off its coast. While authorities said there were no reports suggesting a major threat, the news brought back memories of a 2004 tsunami that killed about 230,000 people in 13 Indian Ocean countries, including Thailand, Sri Lanka and India.
The low-volume Market Vector Indonesia Index ETF gained 0.6 percent.
(Editing by Chizu Nomiyama)
Reuters
