By Donna Kardos Yesalavich
NEW YORK—U.S. stocks rose as worries over euro-zone debt eased following purchases of euro-area government bonds by the European Central Bank and as European Union governments considered boosting the bailout fund for indebted euro-zone countries.
The Dow Jones Industrial Average was up 53.88 points, or 0.5%, at 11691.33 in midday trade. Hewlett-Packard /zigman2/quotes/203461582/composite HPQ -6.02% gained 2.3% after UBS raised its investment rating on the stock to buy from neutral. UBS said H-P is poised to grow most of its segments this year with a refined strategy for margin expansion under its new chief executive.
Chevron /zigman2/quotes/205871374/composite CVX -9.95% added 1.4%, boosted by a climb in crude futures to $90 a barrel.
But Alcoa /zigman2/quotes/200686102/composite AA -4.24% fell 1.3%. The aluminum giant kicked off the earnings reporting season after Monday's close with a swing to a fourth-quarter profit on rising demand and prices for aluminum around the world, but its sales growth wasn't as strong as Wall Street had expected.
The Dow was also weighed down by its telecommunications components, with Verizon Communications /zigman2/quotes/204980236/composite VZ -1.44% down 1.8% and AT&T /zigman2/quotes/203165245/composite T -2.48% off 1.2%, as Verizon announced that it will start selling the iPhone on Feb. 10. AT&T's stock was hurt by worries about the end of its 3 1/2-year exclusive run with the iconic device, while questions about pricing hit Verizon's stock.
The Nasdaq Composite advanced 0.4% to 2719.33, and the Standard & Poor's 500-stock index added 0.5% to 1276.04.
The gains came as investors were encouraged to see the European Central Bank stepped in to buy under-pressure euro-area government bonds for the second consecutive day. In addition, Japanese Finance Minister Yoshihiko Noda said Tokyo may buy more than 20% of the securities issued by the European Financial Stability Facility in its initial round.
Advanced Micro Devices /zigman2/quotes/208144392/composite AMD -1.94% skidded 7.6% after the company forced out Chief Executive Dirk Meyer , just as the long-struggling chip maker appeared to be gaining momentum in its turnaround.
Shares rallied as Japan pledged to buy European debt and Portugal's prime minister reiterated that the country doesn't need a bailout.
The Stoxx Europe 600 index gained 1.3% to 281.98. Lisbon's PSI 20 index jumped 2.4% to 7460.62, as Banco Comercial Portugues surged 5.7% and Portugal Telecom /zigman2/quotes/200023963/composite PT -1.78% gained 2.7%.
Siemens /zigman2/quotes/200873563/delayed DE:SIE -3.29% gained 3% on upbeat comments about first-quarter business at the German electronics and engineering group.