US stocks rose in early afternoon trading on Thursday as investors snapped up beaten-down bank stocks ahead of a vote on a healthcare bill that is seen as President Donald Trump's first policy test.
Failure to pass the legislation, called the American Health Care Act, would cast doubt on Trump's ability to deliver other parts of his agenda that need the cooperation of the Republican-controlled Congress, including ambitious plans to overhaul the tax code and invest in infrastructure.
The House vote had been expected by about 7 pm ET (2300 GMT) but there were signs the deadline could be pushed back.
"There's been a lot of optimism regarding the Trump administration so this could very well be the first setback," said Erik Davidson, chief investment officer at Wells Fargo Private Bank in San Francisco.
"What the market wants is to get through the healthcare question so that we can move on to tax reform."
The S&P 500 has gained 10 percent since the election, spurred mainly by Trump's campaign promises to enact legislation that are seen as pro-business.
The benchmark index is trading at about 18 times expected forward earnings, compared with a 10-year average of 14, according to Thomson Reuters data.
At 12:45 pm ET the Dow Jones Industrial Average was up 83.9 points, or 0.41 percent, at 20,745.2, the S&P 500 was up 8.91 points, or 0.37 percent, at 2,357.36. The Nasdaq Composite was up 16.20 points, or 0.28 percent, at 5,837.84. Ten of the 11 major S&P indexes were higher, with the financial index's 1 percent rise leading the advancers.