U.S. stocks rose

U.S. stocks rose, following the longest weekly rally since February in the Standard & Poor’s 500 Index, amid takeover deals, as Caterpillar Inc.’s earnings beat estimates and Europe made progress taming its debt crisis.

European leaders outlined plans to aid banks and ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund. Europe’s 13th crisis-management summit in 21 months also explored how to strengthen the International Monetary Fund’s role. The complete blueprint won’t come together until a summit in two days.

China’s manufacturing may expand in October for the first time in four months, snapping the longest contraction since 2009, after a preliminary index of purchasing managers showed a rebound in new orders and output. The Chinese report, along with Japanese data today showing an increase in exports exceeding economists’ forecasts, signaled that Asia’s largest two economies are withstanding Europe’s sovereign debt crisis.

Dow 11,909.11     +100.32       +0.85%, Nasdaq      2,695.99       +58.53 +2.22%, S&P 500   1,253.22         +14.97 +1.21%

Gauges of technology, raw material and financial shares had the biggest gains in the S&P 500 among 10 groups, rising at least 1.9 percent.

Caterpillar (CAT) rallied 5.2 percent to $91.95. It said full- year profit will be $6.75 a share and sales will be at the top end of a previously forecast range of $56 billion to $58 billion. Revenue in 2012 will rise 10 to 20 percent, it said. Other companies rose after Caterpillar reported earnings. Deere & Co., the world’s largest farm-equipment maker, added 3 percent to $74.40. Joy Global Inc., the maker of P&H and Joy mining equipment, increased 6.4 percent to $87.02.

United Parcel Service Inc., the largest provider of package deliveries and a proxy for the economy, and Texas Instruments Inc., the largest maker of analog chips, are among companies scheduled to report results this week.

RightNow Technologies surged 19 percent to $42.86. Oracle Corp., the world’s second-largest software maker, agreed to buy the company for $1.5 billion, gaining customer-service expertise to bolster a new Internet-based product.

Healthspring Inc. jumped 34 percent to $53.63. Cigna Corp.  agreed to buy health maintenance organization Healthspring for $3.8 billion in cash to expand the U.S. insurer’s Medicare business.

Sara Lee Corp. was unchanged at $17.77. J.M. Smucker Co., the maker of jams and Jif peanut butter, agreed to buy a majority of the company’s North American coffee and hot-beverage food-service business for about $400 million.

Alcoa (АА), the largest U.S. aluminum producer, gained 3 percent to $10.54. Freeport-McMoRan Copper & Gold Inc., the world’s largest publicly traded copper miner, advanced 6.9 percent to $39.11.