YAHOO [BRIEFING.COM]: The S&P 500 settled higher by 0.7% after spending the duration of the day in a steady upward climb. Equities got off to an upbeat start supported in part by bullish European trade. In addition, merger speculation helped support the markets at the open.

Reports out over the weekend indicated Office Depot (ODP 5.02, +0.43) and OfficeMax (OMX 13.00, +2.25) have discussed a stock-for-stock merger. As a result, shares of the two ended with respective gains of 9.4% and 20.9%. In addition, Staples (SPLS 14.65, +1.70) surged 13.1% as the company stands to benefit from more rationalized competition. The outperformance from the three names helped the SPDR S&P Retail ETF (XRT 68.69, +1.22) gain 1.8%.

While some areas of the discretionary sector saw strength, homebuilders lagged notably. The iShares Dow Jones US Home Construction ETF (ITB 23.33, -0.17) shed 0.7% after seeing intraday losses in excess of 2.0%. The space underperformed after the February NAHB Housing Market Index slipped to 46 from its previous reading of 47. The index turned out to be a disappointment as the Briefing.com consensus had expected an uptick to 48.

Health care stocks were in the news this morning when the Centers for Medicare & Medicaid Services proposed lower 2014 Medicare co-payments. The news carried a negative impact for health care providers as Humana (HUM 73.01, -4.98) and UnitedHealth Group (UNH 56.66, -0.66) lost 6.4% and 1.2% respectively.

On the downside, the materials sector was the weakest performer. The space lagged as industrial metals traded broadly lower. Aluminum, nickel, and copper all lost between 1.5% and 1.7%. In addition, Chinese authorities are expected to unveil measures aimed at curbing the rapid rise in home prices. With such limits, lower construction demand should translate into lower material prices.

Glancing at the S&P 500 sector performance, energy (+1.2%), consumer staples (+1.0%), and utilities (+0.9%) were among the top performers. On the downside, materials (-0.4%) and consumer discretionary (+0.4%) stocks lagged.

Today's volume was right in-line with its average as 735 million shares changed hands on the floor of the New York Stock Exchange.

The busy part of the fourth quarter earnings season is nearing its end as more than 400 S&P 500 components have already reported their results. Of the 402 companies, 67% have exceeded bottom line estimates. However, revenue beats were more common this quarter (67%) than in the past two (40% each) quarters.

Looking forward, first quarter earnings are expected to be flat year-over-year. This is down from the initial expectations of 3.0% growth. In addition, first quarter revenue growth is not expected to exceed 1.0%.

In tomorrow's economic data, weekly MBA Mortgage index will be reported at 7:00 ET. At 8:30 ET, January housing starts, building permits, PPI, and core PPI will all be announced. Lastly, the Federal Reserve will release the minutes from its latest meeting at 14:00 ET. In earnings, DISH Network (DISH 36.09, -0.84) and Toll Brothers (TOL 36.90, -0.18) are scheduled to report their results ahead of the open.DJ30 +53.91 NASDAQ +21.56 SP500 +11.15 NASDAQ Adv/Vol/Dec 1677/1.78 bln/815 NYSE Adv/Vol/Dec 2085/734.6 mln/931

3:30 pm :

• Mar crude oil chopped around near the unchanged level for most of morning floor trade. Despite touching a session low of $95.55 per barrel, the energy component gained steam as it headed into the close and rallied to a session high of $96.73 per barrel. It settled with a 0.8% at $96.67 per barrel.
• Mar natural gas trended higher for its entire pit session after lifting off its session low of $3.22 per MMBtu. It settled with a 3.8% gain at $3.27 per MMBtu, just below its session high of $3.28 per MMBtu.
• Apr gold fell for a fourth consecutive session despite slight weakness in the dollar index. The yellow metal pulled-back from its session high of $1612.00 per ounce set in early morning floor action and touched a session low of $1600.20 per ounce. It trimmed some of the earlier losses in afternoon action and settled 0.3% lower at $1604.00 per ounce.
• Mar silver brushed a session high of $30.03 per ounce moments after floor trade opened but lost momentum and fell into negative territory. It dipped to a session low of $29.17 per ounce and settled with a 1.5% loss at $29.42 per ounce.