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New York -Wall Street stocks posted solid gains on Tuesday following reports of a new Chinese stimulus plan as investors awaited Wednesday's US Federal Reserve monetary policy announcement.
The Dow Jones Industrial Average jumped 0.59% to 17 131.97.
The broad-based S&P 500 gained 0.75% to 1 998.98, while the tech-rich Nasdaq Composite Index rose 0.75% to 4 552.76.
Analysts attributed the rally to reports that the People's Bank of China is providing $81.4 billion in liquidity to China's five largest banks.
"There's a report that the Chinese central bank is boosting its stimulus program," said Jack Ablin, chief investment officer at BMO Private Bank.
"That, combined with a perception that the Fed may not be in a hurry to raise interest rates," moved markets, he said.
Apple fell 0.8% following reports that its new iPhone models may not be available in China until 2015.
Oil companies rallied as US oil prices jumped nearly $2 a barrel. Dow member ExxonMobil rose 1.2%, while ConocoPhillips advanced 1.7%.
Las Vegas Sands (-1.6%) and Wynn Resorts (-0.5%) fell on a dreary outlook for the gaming industry in Macau, where both firms have casinos. The Macau Business Daily said gaming revenues fell 5% between June and August compared with last year, labelling the 2014 period "the summer to forget."
Health insurance company Humana surged 3.7% as it unveiled a $2bn share repurchase authorization plan.
Botox-maker Allergan rose 1.0% as it reached an agreement with Valeant Pharmaceuticals and activist fund Pershing Square Capital Management over the terms of a special shareholder vote on Valeant's unsolicited offer for Allergan. Allergan continues to oppose the deal.
Bond prices were mixed. The yield on the 10-year US Treasury held steady at 2.59%, while the 30-year advanced to 3.35% from 3.34% on Monday. Bond prices and yields move inversely.
