US stocks rose yesterday as reports of more merger activity added to a string of recent deals, suggesting investors still see value in the market after its run up of more than 50 per cent since March.<br /><br />Optimism about potential deals overshadowed concerns about trade friction between the United States and China after Washington imposed special duties on Chinese tire imports.<br /><br />Shares of power company <strong>AES</strong> rose 4.5 per cent after a report that China’s sovereign wealth fund was in talks to take a stake in the firm. <strong>Sprint Nextel</strong> jumped 10.1 per cent amid reports Germany’s <strong>Deutsche Telekom</strong> was considering a bid for its US rival. <br /><br />“The M&A activity is definitely starting to heat up. (The AES news) sparked interest across the whole utility sector,” said Owen Fitzpatrick, head of the US Equity Group at Deutsche Bank Private Wealth Management.<br /><br />Analysts say M&A activity could help the market stay on its recent uptrend. The benchmark Standard & Poor’s 500 index has gained 55 per cent since hitting 12-year lows in early March.<br /><br />US President Barack Obama, speaking in New York one year after Lehman Brothers’ collapse sent world markets into a tailspin, called on financial firms not to fight regulatory reform, but there was little market reaction.<br /><br />The Dow Jones industrial average ended up 21.39 points, or 0.22 per cent, at 9,626.80. The Standard & Poor’s 500 index was up 6.61 points, or 0.63 per cent, at 1,049.34. The Nasdaq Composite index finished 10.88 points higher, or 0.52 per cent, at 2,091.78.<br /><br />Banks, which benefit from M&A activity, were among top gainers as well, with shares of JPMorgan Chase up 2.9 per cent at $43.75 and leading gains on the Dow.<br /><br />Shares of US tire makers also rose, including <strong>Goodyear Tire & Rubber </strong>up 3 per cent to $17.78 and <strong>Cooper Tire & Rubber </strong>up 7.1 per cent to $15.60.<br />On the Nasdaq, shares of <strong>Dendreon</strong> rose 15.1 per cent to $27.43 after analysts said the company, which is developing a vaccine for prostate cancer, is a takeover target.