Wall St closes higher despite IMF growth cuts

US stocks lift for fourth straight session, Nasdaq reaches 12-year high as Alcoa kicks off earnings season on upbeat note.

United States stocks have closed solidly higher for the fourth straight day as investors ignored the the International Monetary Fund's lowered growth forecasts for the US and global economies.

At the closing bell, the Dow Jones Industrial Average increased 75.65 (0.50%) to 15,300.34.

The broad-based S&P 500 added 11.85 (0.72%) to 1,652.31, while the tech-rich Nasdaq Composite Index rose 19.43 (0.56%) to 3,504.26.

The International Monetary Fund trimmed its world economic growth expectations for 2013 to 3.1% from the April forecast of 3.3%.

China and other emerging economic powers now face new risks, the IMF warned, "including the possibility of a longer growth slowdown."

But some analysts said investors were cheered by slightly better-than-expected earnings from Dow component Alcoa, which kicked off the earnings season late Monday, and were increasingly comfortable with the prospect that the Federal Reserve will soon begin tapering its stimulus program.

"People have started to realise in the last week that even though the Fed may be tapering, the only way it is going to happen is if there is economic improvement, "said Michael James, managing director of equity trading and Wedbush Morgan Securities.

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