US stocks gain a third week as S&P 500 rises to 32-month high

US stocks rose for the third straight week, sending the Standard & Poor’s 500 Index to its highest level since June 2008, as the Federal Reserve raised its forecast for economic growth and most companies reporting earnings topped estimates.

Williams Cos surged 13 per cent, leading energy companies to the biggest advance among 10 S&P 500 industries, after the pipeline operator announced plans to spin off its oil and natural-gas exploration unit. Family Dollar Stores Inc. jumped 19 per cent after investor Nelson Peltz offered to buy the retailer. Advanced Micro Devices Inc gained 11 per cent on speculation the semiconductor maker is an acquisition target.

The S&P 500 rose 1 per cent to 1,343.01. The index needs to advance 0.7 per cent to 1,353.06 to complete a 100 percent rally from its 2009 low. The Dow Jones Industrial Average gained 117.99 points, or 1 per cent, to 12,391.25.

“Earnings have come through spectacularly,” said Michael Mullaney, who manages $9.5 billion at Fiduciary Trust Co in Boston. “Everything from a fundamental standpoint feels as good as it's felt in quite some time.”

The S&P 500 has advanced 31 per cent since last year's low in July as corporate profit surpasses analysts’ estimates for the eighth straight quarter, according to data compiled by Bloomberg. The Conference Board's index of US consumer confidence climbed to an almost three-year peak in January, and the Institute for Supply Management-Chicago Inc said businesses expanded last month at the fastest pace since 1988.