In earnings news, Marvell Technology jumped almost 10 percent despite an unexpectedly big drop in profits as the the semiconductor firm gave a surprisingly upbeat outlook.
But OmniVision sank following disappointing guidance despite a jump in profits and margins for the chip designer, which makes products for the iPhone.
Ebay'sPayPal sued Google for allegedly stealing trade secretsrelated to mobile payment technology.
Bank stocks gained after positive analyst commentary on many of the financials in Europe and a proposal in Basel III for more favorable requirements for banks.
Bank of America
,
Goldman
Sachs
and
Morgan Stanley
were up more than 2 percent each.
Medco Health Solutions plunged almost 10 percent after news that the pharmacy benefits management company will lose a major contract beginning next yearto CVS . In addition, Lazard Capital cut its price target on the firm to $64 from $73. CVS shares rose almost 2 percent.
Aflac , meanwhile fell after the life insurer was downgraded to "equal weight" by Morgan Stanley after Japanese regulators evaluated the company's capital levels. PrudentialFinancial and MetLife got better readings from the regulators.
Meanwhile, Johnson & Johnson shares gained following a positive update on the firm's prescription drug business and after some analysts increased their price target for the drugmaker's stock.
The rise in stocks also comes even amid news thatGreek political leaders failedto come to an agreement on how to resolve the debt crisis gripping the country, according to sources, Reuters reported.
Gold hit a 3-week high, climbing above $1,535 an ounce amid reports that Chinese imports were likely to surge and amid concerns over the restructuring of Greece's debt.
Meanwhile, the dollar fell against the euro and a basket of currencieseven as debt concerns in the euro zone remained troublesome. Oil prices were mixed, with U.S. light, sweet crude rising slightly to settle above $100 a barrel.
On the economic front, pending home sales fell 11.6 percent in Aprilfrom March and 26.5 percent from a year earlier, the National Association of Realtors said.
Despite the dismal news, homebuilders including Pulte , KBHome and Beazer gained.
But a final reading on consumer sentiment rose to 74.3, up from 69.8 the month before and better than the 72.4 initially reported by Thomson Reuters/University of Michigan. Economists surveyed by Reuters had expected the index to be unchanged.
Also, personal income and personal spending each rose 0.4 percent in April, the Commerce Department reported. Personal income had been up 0.4 percent in March, and April's gain was expected, while spending was up less than expected in April, after rising 0.5 percent in March.
Shares in Europe closed higher as rising metal prices pushed mining companies' shares higher.
On Tap Next Week:
MONDAY: Memorial Day—All Markets Closed.
TUESDAY: S&P Case-Shiller Home Price Index, Chicago PMI, consumer confidence, farm prices.
WEDNESDAY: Mortgage applications, Challenger job-cut report, ADP employment report, ISM manufacturing index, construction spending, auto sales; D9: All Things Digital Conference.
THURSDAY: Chain store sales, jobless claims, factory orders, natural gas inventories, oil inventories, money supply.
FRIDAY: Non-farm payroll report, ISM non-manufacturing index; Wal-Mart shareholder meeting.
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