Stocks climbed Tuesday amid anticipation of merger-and-acquisition activity in the office supplies retail sector.
About 40 minutes into trade, the Dow Jones Industrial Average was up 46.11 points (0.33 percent) at 14,027.87.
The broad-based S&P 500 rose 5.67 points (0.37 percent) to 1,525.46, while the tech-rich Nasdaq Composite increased 10.59 (0.33 percent) to 3,202.62.
Early trading was buoyed by a positive report on investor sentiment from Germany and by speculation about additional mergers after the huge Heinz buyout announced last week, said Briefing.com analyst Patrick O'Hare.
These dynamics helped offset a widely watched index of builder confidence that declined from 47 to 46 in February.
US equities had closed Friday without a clear direction ahead of a long weekend. Financial markets were closed Monday for a public holiday.
According to media reports, retailers Office Depot and OfficeMax are exploring an all-stock merger.
Office Depot was up 25.3 percent, while OfficeMax jumped 27.9 percent.
The news also lifted competitor Staples, which rose 15.4 percent.
Internet giant Google topped $800 for the first time, gaining 1.3 percent at $803.34 amid reports it is planning stores in the United States.
Health care company Humana fell 8.7 percent after disclosing that benchmark payment rates under the federal Medicare and Medicaid programs would result in mid-single digit declines in its payment rates.
Other health care companies were also pulled down by the news. UnitedHealth Group was down 2.6 percent, Cigna was off 3.6 percent and Aetna fell 2.5 percent.
Medical technology company Medtronic slipped 2.7 percent despite reporting profits that bested Wall Street expectations.
ConAgra Foods edged up 0.3 percent after raising its full-year profit forecast.
Express Scripts rose 3.2 percent after earnings slightly exceeded expectations and the company offered a solid outlook for 2013 profits.
The yield on the 10-year Treasury bond fell to 2.00 percent from 2.01 percent late Friday, while the 30-year yield was unchanged at 3.18 percent. Bond prices and yields move inversely.