US STOCKS-S&P 500 hits record in broad market rally

Reuters - UK Focus

* S&P 500 hits record on merger, acquisition activity

* Insurance stocks rise after Humana (NYSE: HUM - news) comments

* Men's Wearhouse raises offer for Jos. A. Bank

* Indexes up: Dow 0.8 pct, S&P 0.7 pct, Nasdaq 0.8 pct

By Ryan Vlastelica

NEW YORK (Frankfurt: HX6.F - news) , Feb 24 (Reuters) - U.S. stocks rose on Monday,advancing in a broad rally as merger activity boosted the S&P500 to an all-time high.

Despite the day's gains, many investors were concerned thatmarkets were getting overvalued with recent data failing to meetexpectations, though the latter has largely been blamed on harshwinter weather rather than worsening fundamentals.

RF Micro Devices Inc (NasdaqGS: RFMD - news) agreed to buy TriQuintSemiconductor Inc for about $1.6 billion, while Men'sWearhouse Inc raised its cash tender offer for rivalmen's clothing retailer Jos. A. Bank Clothiers Inc JOSB.O to$63.50 per share from $57.50.

Shares of RF climbed 15.5 percent to $6.70 while TriQuintgained 20 percent to $11.04. Men's Wearhouse rose 7.7 percent to$48.57 while Jos. A. Bank was up 8.8 percent at $59.89.

"Seeing merger activity is a good sign for a continuedgrowth market, but we've started to taper back our domesticholdings in favor of international markets which seem cheapergiven the S&P's (price-to-earnings ratio)," said Paul Radeke,vice president at the Minneapolis-based KDV Wealth Management,which has about $660 million in assets under management.

Monday's deals followed Facebook (NasdaqGS: FB - news) 's massiveacquisition of messaging company WhatsApp last week.

Humana Inc and UnitedHealth Group (Frankfurt: UNH.F - news) were bothamong the S&P's biggest percentage gainers, with Humana up 5.5percent to $109.24 after it said the government's proposed cutsto the private Medicare program appeared less than it hadforecast. UnitedHealth rose 3.1 percent to $76.09.

Aetna Inc (NYSE: AET - news) rose 1.6 percent to $71.52 after giving a2014 earnings outlook.

The Dow Jones industrial average was up 126.53points, or 0.79 percent, at 16,229.83. The Standard & Poor's 500Index was up 13.68 points, or 0.74 percent, at 1,849.93.The Nasdaq Composite Index was up 31.93 points, or 0.75percent, at 4,295.34.

Nine of the S&P's 10 sectors rose on the day, with energyshares up 1.7 percent following positive comments fromKLR Group on Noble Energy (NYSE: NBL - news) , which jumped 4.3 percent to$69.74. More than two-thirds of companies traded on the New YorkStock Exchange rose on the day, while 63 percent ofNasdaq-listed companies gained.

Overseas markets remained in focus after Ukrainian PresidentViktor Yanukovich was ousted following deadly street protests,leaving a potential power vacuum and an ailing economy.Ukraine's finance ministry said the economy required $35 billionin foreign aid over the next two years, with the first trancheneeded within two weeks.

While most U.S. companies have limited direct exposure toUkraine, investors worry that the instability in the regioncould spread throughout emerging markets.

In the latest U.S. data, the National Activity index fell to-0.39 in January from 0.16 in December while financial data firmMarkit's preliminary February read on the services sector fellfrom 56.7 to 52.7.

Pfizer Inc (NYSE: PFE - news) shares rose 1.4 percent to $31.91 afterthe company said that its drug Prevenar 13 preventedcommunity-acquired pneumonia in individuals age 65 and older ina study.

Verizon Communications Inc (LSE: VZC.L - news) dipped 1.2 percent to$46.70 after the company gave a 2014 revenue outlook.

Many traders are looking ahead to Thursday, when FederalReserve Chair Janet Yellen will speak to the Senate BankingCommittee in her semi-annual testimony about monetary policy.

Yellen's comments will be scoured for insight into theextent to which bad weather has impacted economic activity, aswell as for confirmation that the Fed will not make any changesto its schedule for trimming stimulus.

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