US STOCKS-Wall St rises with health insurers, S&P nears record

Tue Apr 2, 2013 4:45pm EDT
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* S&P 500 inches closer to all-time intraday high

* Healthcare stocks rally, Humana among S&P's top percentage gainers

* Indexes up: Dow 0.6 pct, S&P 0.5 pct, Nasdaq 0.5 pct

By Caroline Valetkevitch

NEW YORK, April 2 (Reuters) - U.S. stocks rose on Tuesday, led by the health care sector after a government decision on payment rates, while factory orders data confirmed the economy is steadily improving.

The S&P 500 closed at another record high, though it fell short of breaking above its all-time intraday high of 1,576.09 during the session. The Dow also ended at another record high.

The U.S. government dropped plans to cut payments for private Medicare Advantage insurers and instead said it would allow a 3.3 percent raise.

The news boosted shares of some health insurers, including Humana, which derives about two-thirds of its revenue from Medicare Advantage business. The stock jumped 5.5 percent to $79.11 and was among the biggest percentage gainers on the S&P 500. UnitedHealth Group gained 4.7 percent to $61.74.

"They didn't expect the result that they got. That will help with their bottom line," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.   Continued...