The S&P 500 rose 1.3 per cent to 1,254.19, dragged up by acquisition targets. It has now gained almost 11 per cent in October after five consecutive monthly falls.
Health insurer Cigna’s decision to buy HealthSpring for $3.8bn (£2.38bn), in a bid to jump-start its Medicare business, sent the latter rocketing 34 per cent.
Oracle said it plans to buy RightNow for about $1.5bn, sending the online customer service company’s stock up 19 per cent and sparking speculation of bids for other cloud computing firms. Smucker is set to buy some Sara Lee coffee assets for around $350m.
Meanwhile, Caterpillar reported a 44 per cent increase in quarterly earnings and record revenue after seeing stronger than expected demand.
It posted third-quarter profits of $1.14bn, compared to $792m a year earlier. Sales rose 41 per cent to a record $15.7bn. The company now expects annual revenue of $58bn, including its recent acquisition of Bucyrus.
Amgen also reported better-than-expected third quarter net profit of $454m, helped by strong sales of its products to boost white blood cells, and the company raised its full-year earnings forecast. Its shares rose 0.61 per cent.
And money manager Invesco said third-quarter earnings rose eight per cent to $166.9m despite tough markets, as customers added money to fixed income and balanced funds.
One of the only dark spots in the slew of US results was Texas Instruments, which beat some forecasts but missed others with earnings of $601m for the quarter, compared with $859m a year ago.