Stocks gained on Wednesday after a top German court gave a green light for the country to ratify Europe's new bailout fund and before a Federal Reserve decision on Thursday about injecting more stimulus into the economy.
Stocks bounced in the early going after the German Constitutional Court gave a green light for the new euro zone rescue fund to go ahead, which will allow the European Central Bank to buy sovereign bonds in an effort to lower interest rates and boost economic growth.
But investors quickly shifted attention to the Fed, which began a two-day policy meeting on Wednesday and is expected to announce on Thursday whether it will introduce more monetary easing.
"We are chipping away all these negative concerns of investors," said Craig W. Johnson, market strategist at Piper Jaffray. "The market is going to continue to move higher."
The S&P 500 index has advanced more than 9 percent since the start of June on hopes for global central bank stimulus. But the index has been unable to significantly pierce the 1,438-1,440 level, seen as a significant resistance point.
Apple Inc rose 1 percent to $667.50 after it unveiled its iPhone 5. It has a larger 4-inch "retina" display, ability to surf a high-speed 4G LTE network, and is 20 percent lighter than the previous iPhone 4S. The introduction of the new iPhone comes as Apple tries to fend off competition that has reached fever-pitch.
The Dow Jones industrial average <.DJI> was up 26.14 points, or 0.20 percent, at 13,349.50. The Standard & Poor's 500 Index <.SPX> was up 4.15 points, or 0.29 percent, at 1,437.71. The Nasdaq Composite Index <.IXIC> was up 10.16 points, or 0.33 percent, at 3,114.69.
Facebook Inc jumped 6 percent to $20.64 after Chief Executive Mark Zuckerberg hinted at new growth areas from mobile to search in his first major public appearance since the No. 1 social network's rocky IPO in May.
Ford Motor's stock was up 0.7 percent and traded at $10.22, after the company's board of directors decided to discuss this week a succession plan for Chief Executive Alan Mulally, who is expected to retire by the end of 2013, Bloomberg reported on Tuesday, citing a person familiar with the matter.
Chesapeake Energy slipped 1 percent to $19.88 after the company said it is selling $6.9 billion in gas fields and pipelines, with most of its assets in the Permian Basin being sold to Royal Dutch Shell Plc and Chevron Corp , as well as most of its remaining infrastructure network.
Mediware Information Systems Inc shares surged 39 percent to $21.88. The clinical software solutions provider agreed to be acquired by private equity firm Thoma Bravo LLC for $22 per share in cash.
(Editing by Dave Zimmerman)