Shares rally on US tech earnings, ECB purchase plans

S&P 500 rises 1.96%, its biggest daily percentage gain since Oct 10, 2013

A measure of global equity markets advanced on Tuesday as technology earnings lifted US shares and the prospect of European Central Bank corporate bond purchases boosted European stocks, while weighing on safe-haven US Treasuries prices.

Shares of Apple Inc and Texas Instruments Inc gained on stronger-than-expected quarterly earnings, driving up the tech-heavy Nasdaq index more than 2% and helping the S&P 500 mark a fourth straight session of gains.

"Apple did have a strong impact," said Margaret Patel, senior portfolio manager at Wells Capital Management in Boston. "When a stock that big which is widely held reports great earnings, it helps to lift the overall market."

Patel, who does not own Apple shares, said the stock market was "primed to rally."

"Our correction is pretty much over and the market will do better as companies report results over the next few weeks," she said.

The S&P 500 rose 1.96%, its biggest daily percentage gain since Oct. 10, 2013, while the Nasdaq posted its biggest percentage gain since January 2013. The Dow rose more than 1%, despite a selloff in the shares of component Coca-Cola after the company reported disappointing results.

European shares gained on a Reuters report that the ECB was readying a plan to buy corporate bonds. The purchases are seen as helping banks free up more of their balance sheets for lending.

"You see the European Central Bank now coming to the fore, signaling their intent to increase their balance sheet, and that is allowing the market to breathe a little sigh of relief," said Kevin Caron, market strategist at Stifel, Nicolaus & Co in Florham Park, New Jersey.

The news on the ECB sent low-risk US Treasuries prices down and hurt the euro.

MSCI's all-country world index was last up 1.38% at 405.45, while the FTSEurofirst 300 index of top European shares closed up 2.09% at 1,299.26.

The Dow Jones industrial average closed up 1.31% at 16,614.81, while the S&P 500 closed up 1.96% at 1,941.28. The Nasdaq Composite closed up 2.4% at 4,419.48.

The dollar index, which tracks the greenback versus a basket of six currencies, was up 0.48% at 85.357.

Benchmark 10-year US Treasury notes were last down 12/32 in price to yield 2.23%.

Oil prices rose. Brent crude settled up 82 cents, or 0.96%, at $86.22 per barrel. US crude settled up 10 cents, or 0.12%, at $82.81 per barrel.