US stocks gain as European debt concerns ease

U.S. stocks opened higher on Wednesday after investors digested a healthy bond sale in Portugal and are awaiting Federal Reserve's report on current economic conditions.

Portugal sold bonds worth 1.25 billion euros ($1.62 billion) due to strong demand, resulting payment of a far lower rate for its longer-term debt than previously. The country needs to sell as much as 20 billion euros in bonds this year to finance its budget, and said it plans to market a new bond through banks in the first quarter.

The S&P 500 Index gained 3.69 points, or 0.29 percent, to trade at 1,278.17 at 9.30 a.m. EDT. The Dow Jones Industrial Average rose 32.93 points, or 0.28 percent, to trade at 11,704.81. The Nasdaq Composite Index advanced 11.50 points, or 0.42 percent, to 2,728.49.

On the economic front, import price index for the month of December came in lower than expected at 1.10 percent compared to analysts' expectation of 1.20 percent. Import prices increased 1.5 percent in November.

Investors will be closely eyeing the Federal Reserve's Beige Book, a compilation of anecdotal evidence on economic conditions from each of the 12 Federal Reserve districts.

The Treasury Budget will also be on the limelight as it measures the difference in value between the federal government's income and spending during the given month.

The Energy Information Administration (EIA) will release its weekly petroleum inventory report for the week ended January 7th.

On the corporate front, shares of ITT (ITT) surged 19 percent after it said it plans to split in to three companies.

Lululemon Athletica (LULU) shares climbed 8 percent as it raised its fourth quarter earnings forecast.

Noble Corp.'s (NE) shares rose 4 percent after Standard & Poor's said the offshore driller would replace QLogic Corp. on the S&P 500 index.

Shares of Cliffs Natural Resources Inc. (CLF), one of the North America's largest iron-ore producers, gained 4.5 percent after it struck a deal to buy Consolidated Thompson Iron Mines Ltd. for about C$4.9 billion ($4.95 billion).

Meanwhile, Arch Coal cut its full-year outlook yesterday, sending its shares down 1.8 percent in the morning trade on Wednesday.

On the currency front, the euro advanced 0.50 percent to 1.3039 against the dollar, which gained 0.134 percent against the yen at 83.35.

Crude oil futures advanced 0.17percent to $97.78 a barrel, while gold futures declined 0.36 percent to 1,379.30.

European stocks also advanced with FTSE 100 up by 15.91 points, DAX30 up by 92.78 points and CAC 40 up by 60.68 points.