U.S. stocks climbed on Wednesday, again lifting the Dow industrials into uncharted terrain, with investor sentiment lifted by corporate earnings and deals.
"The market bias is upwards until there is a reason for investors to lose enthusiasm. At some point, you'd think the laws of Newtonian physics would apply, but we think valuations are full, not stretched," said Mark Luschini, chief investment strategist at Janney Montgomery Scott, of the bull market, which has the Dow and S&P 500 either in, or near, record highs on a near daily basis.
Equities maintained near session highs with the release of the Federal Reserve's Beige Book, which found the economy expanding at a modest to moderate pace, with consumer spending up in all of of the Fed's districts.
Read MoreBeige Book: manufacturing expanding and job growth up
Technology shares rallied in the wake of earnings from Intel, with the chip maker forecasting third-quarter revenue above Wall Street's estimates late Tuesday.
The company's results and "stronger-than-expected PC sales are indicative of business spending," said Luschini.
Time Warner shares shot higher after CNBC reported it had rejected a $80 billion takeover bid by 21st Century Fox, which confirmed making an offer for Time Warner, but also said the companies were not currently in discussions.
Read MoreTime Warner rejects $80B offer from 21st Century Fox
Apple and International Business Machines gained after saying they would jointly develop applications for business users and mobile devices.
Major U.S. Indexes
After a 78-point jump to an intraday record 17,139.35, the Dow Jones Industrial Average rose 77.52 points, or 0.5 percent, to 17,138.20, a record close, with technology giants Intel, Microsoft, IBM and Cisco Systems leading blue-chip gains.
Not far from its record high, the advanced 8.29 points, or 0.4 percent, to 1,981.57, with energy and technology pacing gains and health care and financials the largest laggards among its 10 major sectors.
The Nasdaq rose 9.58 points, or 0.2 percent, to 4,425.97.
For every three shares falling, roughly four gained on the New York Stock Exchange, where nearly 675 million shares traded. Composite volume approached 3.4 billion.
The dollar rose against other currencies, and the 10-year Treasury yield shed 2 basis points to 2.533 percent.
Gold and oil futures rose, with the former up $2.70, or 0.2 percent, at $1,299.80 an ounce and the latter rising $1.24, or 1.2 percent, to $101.20 a barrel.
On Capitol Hill, U.S. Federal Reserve Chair Janet Yellen concluded a second day of congressional testimony, where she faced a barrage of questions from Republican lawmakers about legislation to make the Fed more accountable.
Read More
Dallas Fed President Richard Fisher on Wednesday said the Fed would likely start hiking interest rates early next year, if not sooner.
Ahead of Wednesday's open, stock futures gained after a report showed China's second-quarter economic growth coming in above expectations; with futures retaining gains after the government reported U.S. producer prices rose 0.4 percent in June, versus expectations of a 0.2 percent increase.
Another report had U.S. factory output increasing for a fifth month in June as manufacturers cranked out more aircraft, chemicals and furniture.
Read MoreIndustrial production gains modestly as recovery crawls along
And, a monthly survey from the national Association of Home Builders rose 4 points in July to 53, crossing the line into positive territory.
Read MoreHome builder sentiment index jumps
On Tuesday, stocks fluctuated, with investors measuring upbeat earnings from the banking sector against concern from the Federal Reserve that valuations on small-cap and high-flying names might be "stretched."
Read MoreStocks mixed; Nasdaq hit by valuation worry
Wednesday's bounce back in the technology sector is positive, as "you need those heavily weighted sectors like tech and financials, each of which represent 20 percent of the S&P 500," said Robert Pavlik, chief market strategist at Banyan Partners.
"But we haven't seen both of these major sectors working together at the same time, without them you're not going to see the market move much higher," said Pavlik.
The financial sector on Wednesday was among those declining, hit by Bank of America, which fell after reporting a drop of 43 percent in second-quarter profit and a 10-cent miss on earnings per share. The Wall Street Journal citing people familiar with the matter in reporting the bank had offered $13 billion to settle a Justice Department probe into mortgage securities it sold.
—By CNBC's Kate Gibson
Coming Up This Week:
Thursday
Earnings: IBM, Google, Morgan Stanley,Blackstone,KeyCorp,AutoNation, Novartis, SAP, Philip Morris,UnitedHealth,Baker Hughes,Capital One, Celanese, Cypress Semi,Sherwin-Williams, Danaher,Canadian Pacific Railway, Seagate Technologies
830 a.m.: Initial claims
8:30 a.m.: Housing starts
10:00 a.m.: Philadelphia Fed survey
Friday
Earnings: General Electric, Honeywell, Kansas City Southern, Bank of NY Mellon, Ericsson, VF Corp, Interpublic
9:55 a.m.: Consumer sentiment
10:00 a.m.: Leading indicators
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