MRK Merck and Co Inc

By Ellie Ismailidou and Victor Reklaitis, MarketWatch

Fed's Yellen sees 'mixed developments' in the economy; Tesla shares dive after bid for SolarCity

U.S. stocks climbed Wednesday for a third straight session, joining a global stock rally boosted by expectations that the U.K. will vote in favor of remaining a member of European Union in Thursday's closely watched referendum.

Investors also are keeping one eye trained on a second day of congressional testimony (http://blogs.marketwatch.com/capitolreport/2016/06/22/live-blog-and-video-of-janet-yellen-testifying-in-house-hearing/) from Federal Reserve Chairwoman Janet Yellen on the economy and monetary policy.

On Tuesday, Yellen said a possible Brexit and other risks justify a cautious policy approach (http://www.marketwatch.com/story/feds-yellen-says-brexit-could-have-significant-economic-repercussions-2016-06-21). But on Wednesday, the Fed chief focused on the U.S. fundamentals, noting that economy is picking up in the second quarter and she is "hopeful" there will be a commensurate pickup in job growth.

Contributing to investors' risk appetite was a report showing that sales of previously owned homes (http://www.marketwatch.com/story/existing-home-sales-rise-again-in-may-as-buyers-turn-out-despite-tight-supply-2016-06-22)increased in May to the highest level in nearly a decade.

Among individual stocks, Tesla Motors Inc. (TSLA) was in the spotlight after the electric-car company headed by Elon Musk offered to buy SolarCity Corp. (SCTY) late Tuesday.

The S&P 500 rose 8 points, or 0.4%, to 2,096, led by a 1.2% jump in health-care stocks. Most of the S&P's 10 sectors were in positive territory, with utilities and energy slipping in and out of the red.

The Dow Jones Industrial Average rose 62 points, or 0.4%, to 17,892, led by a 1.6% gain in Merck & Co. Inc.(MRK)(MRK)(MRK)McDonald's Corp.(MCD) was leading the losses, down 1.6%.

Meanwhile the Nasdaq Composite Index tacked on 24 points, or 0.5%, to 4,868.

Stocks world-wide have been lifted in the past three sessions after polls suggested U.K. voters will reject the push for a "Brexit," meaning Britain exiting the EU. But more polls were expected Wednesday and could hit stocks and other assets perceived as risky.

Still, the vote is a "binary event and as such it can't be fully priced in," said Crit Thomas, global market strategist at Touchstone Investments.

"One way or the other, there will be a market reaction," Thomas said, adding that investors should brace for a spike in volatility .

Brexit referendum results from the first counting areas are expected around 7:30 p.m. Eastern Time on Thursday, or 12:30 a.m. London time on Friday.

Read more:When will we know the result of this week's Brexit vote? (http://www.marketwatch.com/story/when-will-we-know-the-result-of-the-brexit-vote-2016-06-21)

(http://www.marketwatch.com/story/when-will-we-know-the-result-of-the-brexit-vote-2016-06-21)Despite the modest advance, nervousness is still the overwhelming tone in the market, with investors wary of the recent rally, said Tom Cassidy, chief investment officer at Univest Wealth Management.

"There's just too much going on," Cassidy said, with the Brexit vote looming, the market still feeling the sting of May's dismal jobs report and Fed chief Yellen showing constant concern about the U.S. economy.

And see:Everything you need to know about the Brexit referendum (http://www.marketwatch.com/story/the-brexit-vote-everything-you-need-to-know-about-the-referendum-2016-06-07)

Other markets: Oil prices pulled back under $50 (http://www.marketwatch.com/story/oil-back-under-50-after-eia-reports-900000--barrel-fall-in-us-crude-supplies-2016-06-22), after the U.S. Energy Information Administration reported (http://ir.eia.gov/wpsr/wpsrsummary.pdf)a much smaller-than-expected decline in U.S. crude supplies.

European stocks (http://www.marketwatch.com/story/european-stocks-drift-lower-as-brexit-vote-draws-near-2016-06-22) gained, while Asian markets finished mixed (http://www.marketwatch.com/story/asian-markets-mostly-subdued-ahead-of-brexit-2016-06-21). Gold futures and the ICE U.S. Dollar Index pulled back.

Individual movers: Shares in Tesla fell 7% action after the maker of electric cars, helmed by Elon Musk, said late Tuesday it offered to buy SolarCity Corp.(SCTY)--a solar company in which Musk is a major shareholder..

Read: Elon Musk explains why Tesla bid for SolarCity: Live blog recap (http://blogs.marketwatch.com/thetell/2016/06/22/elon-musk-explains-teslas-solarcity-offer-live-blog/)

And see:Musk has huge conflict of interest in Tesla-SolarCity deal, but that won't stop it (http://www.marketwatch.com/story/elon-musk-has-massive-conflict-of-interest-in-tesla-solarcity-deal-but-that-wont-stop-it-2016-06-21)

IMAX Corp.(IMAX) and AMC Entertainment Holding Inc.'s(AMC) AMC Theatres said Wednesday they have agreed to expand their revenue sharing deal (http://www.marketwatch.com/story/imax-and-amc-to-add-25-theatres-to-their-revenue-sharing-deal-2016-06-22) with the addition of 25 IMAX facilities at AMC theaters. IMAX shares were up 0.9% while AMC gained 1.2%.

(END) Dow Jones Newswires

June 22, 2016 11:35 ET (15:35 GMT)

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