Stocks gain for third session. Microsoft falls.
Dow rises 75 points as stocks put together a three-day rally. But Microsoft falls after it announces purchase of Internet calling company Skype.
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The dollar, meanwhile, closed slightly lower against a basket of currencies, while the euro stabilized, although worries remain about Greece's debt troubles. Greece denied it was seeking a new bailout package from the EU. Also, an auction of short-term Greek debt went smoothly, which was encouraging to investors.Skip to next paragraph
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Elsewhere in corporate news, Google gained after the search-engine giant said it would launch a music service that would allow for flexible music storage, similar to a service recently created by Amazon.com.
Utilities were led higher by First Energy, which climbed after Citigroup raised its price target on the utility holding company to $41 from $36, and Wells Fargo boosted its rating to "outperform" from "market perform."
The Dow Jones Utility Index gained as more than 90 percent of all utility stocks rose.
Volume on the consolidated tape of the New York Stock Exchange was 3.3 billion shares, while 835 million changed hands on the NYSE floor.
Treasury prices shaved earlier losses after the government auctioned $32 billion in 3-year notes, which had a high yield of 1.000 percent and a bid-to-cover of 3.29.
On the economic front, wholesale businesses increased inventories by 1.1 percent in March amid a jump in sales after a 1 percent gain in February, according to the Commerce Department.
Also, an index of small business owner sentiment fell 0.7 point to 91.2 in April even as sales performance improved. The decline in the National Federation of Independent Business's small-business optimism index follows a 2.6-point drop in March.
China reported its trade surplus was $11.4 billion, nearly four times higher than expected, sparking fears that it could reignite criticism about its currency policy, but encouraging investors worried about a slowdown in China's growth.
Asian stocks rose, while European shares also closed higher, led by banks and mining stocks.