Stocks are rising after Microsoft said it would buy Skype for $8.5 billion and more companies reported strong earnings.
Companies have built up a record amount of cash since the recession, and they have begun to use it to purchase rivals, pay dividends and buy back their own stock.
Dairy producer Dean Foods Co. jumped 10.9 percent after its earnings came in above expectations. Dean had a stronger start to the year than it expected and raised its forecast for full-year earnings.
The Dow Jones industrial average is up 42 points, or 0.3 percent, to 12,727 in midday trading. The S&P 500 is up 6, or 0.4 percent, to 1,352. The Nasdaq composite index is up 13 points, or 0.5 percent, to 2,857.