(Repeats to fix typo in paragraph 17)
* Healthcare shares climb on US Senate cliffhanger
* Kraft seals $19.6 billion deal to buy Cadbury
* IBM's profit beats estimates after the bell
* Dow up 1.1 pct; S&P 500 up 1.3 pct; Nasdaq up 1.4 pct
* For up-to-the-minute market news, click []
(Adds IBM's after-hours stock activity and volume)
By Ellis Mnyandu
NEW YORK, Jan 19 (Reuters) - U.S. stocks rose broadly on
Tuesday, lifting the Dow and the S&P 500 to fresh 15-month
closing highs as investors bet a potential Republican victory
in Massachusetts' Senate race could stall Obama's reform
agenda.
Wall Street also got a boost from technology shares, which
rallied in anticipation of strong earnings from bellwether
International Business Machines Corp <IBM.N>, which rose 1.8
percent to $134.14, making it the Dow's top boost.
Indeed, after the bell, IBM delivered quarterly earnings
that beat Wall Street's forecasts. For details, see
[]
But healthcare shares rallied the most in the regular
session on hopes that policy gridlock in Washington would slow
the healthcare overhaul, removing a threat to the profits of
insurers and drug companies.
The S&P Healthcare Index <.GSPA> climbed 2 percent, with
drug company Eli Lilly <LLY.N>, up 4.4 percent at $37.41, among
the standouts. Health insurers' shares also rallied briskly,
with Humana Inc <HUM.N>, up 7.1 percent at $51.94.
Massachusetts voters were deciding a tight race on Tuesday
to replace the late Edward Kennedy, a Democrat. The loss of one
seat in the U.S. Senate could hurt the Democrats' ability to
proceed to a vote on the planned healthcare overhaul that
seemed to be in the final stages of the legislative
process.[]
"A Republican win would be a positive for the markets since
it would mean increased potential for gridlock in Washington,"
said Carmine Grigoli, chief U.S. strategist at Mizuho
Securities USA in New York. "This is probably especially true
now, given the very large social agenda of the Obama
administration."
The Dow Jones industrial average <> jumped 115.78
points, or 1.09 percent, to end at 10,725.43. The Standard &
Poor's 500 Index <.SPX> shot up 14.20 points, or 1.25 percent,
to 1,150.23. The Nasdaq Composite Index <> climbed 32.41
points, or 1.42 percent, to 2,320.40.
The reform bills under debate in Congress would reshape the
healthcare insurance market through new regulations, taxes and
other changes. The healthcare overhaul is President Barack
Obama's top domestic priority, and the White House said on
Tuesday that Obama does not believe healthcare reform is dead
even should the Democrat, Martha Coakley, lose.
Health insurer Aetna Inc <AET.N> gained 4.2 percent to
$32.66. Drugmaker Merck & Co <MRK.N>, a Dow component, gained 3
percent to $40.62.
The Dow also received a boost from McDonald's Corp <MCD.N>
after Credit Suisse upgraded the fast food giant, saying its
international businesses were a potential driver of earnings.
McDonald's stock gained 1.9 percent to $63.48 and was the
Dow's third top percentage gainer, ranking behind 3M Co
<MMM.N>, up 2.1 percent at $85.12. []
All 10 S&P 500 industry sectors ended in positive
territory.
Strong momentum carried the Dow and the S&P 500 to fresh
15-month closing highs and lifted the Nasdaq to its highest
close in 16 months. The S&P 500 is now up 70 percent since
hitting bottom in early March 2009.
IBM SLIPS DESPITE OUTLOOK
Shares of large-cap technology companies, including Apple
Inc <AAPL.O>, boosted the Nasdaq before IBM's earnings. Apple,
the maker of the iPhone, was up 4.4 percent at $215.04.
The PHLX Semiconductor Index <.SOXX> advanced 1.8 percent.
International Business Machines Corp, a major technology
services company, also raised its profit target for 2010, but
its stock dipped 0.5 percent to $133.40 in after-hours trading
as some investors booked profits following their strong run-up
recently.
Citigroup Inc <C.N> rose 3.5 percent to $3.54 in regular
trading after it reported a fourth-quarter loss that narrowed
from the previous year. The loss came on charges linked to
repaying government funds, following JPMorgan Chase & Co's
<JPM.N> disappointing results on Friday. []
Kraft Foods Inc <KFT.N> was the biggest drag on the Dow,
falling 0.6 percent to $29.41 after it agreed to a revised
cash-and-stock deal to buy Cadbury <CBRY.L> for about $19.6
billion. []
In other acquisition news, Tyco International <TYC.N>
agreed to buy Broadview Security, which operates as Brink's
Home Security Holdings Inc <CFL.N>, for $1.9 billion. Brink's
shares surged 32.2 percent to $41.54. []
On the New York Stock Exchange, about 1.04 billion shares
changed hands, below last year's estimated daily average of
2.18 billion. On the Nasdaq, about 2.08 billion shares traded,
above last year's daily average of 1.63 billion.
Advancing stocks outnumbered declining ones on the NYSE by
a ratio of 7 to 2, while on the Nasdaq, about nine stocks rose
for every four that fell.
(Editing by Jan Paschal)
