NEW YORK (TheStreet) -- Stocks extended their rally by mid-afternoon Friday as all 10 S&P 500 sectors turned positive. Markets rebounded from a selloff on Thursday that saw all of the benchmark indexes tumble 1%.
The S&P 500 and the Nasdaq climbed 1%. The Dow Jones Industrial Average gained 0.9%, or 182 points.
Yum! Brands (YUM) jumped more than 5% after CNBC reported activist investor Corvex has taken a significant position in the fast food chain owner. Shares were already higher after investment firm Third Point disclosed a new position on Thursday based on expectations of a sharp turnaround in profit at Yum!.
Altera (ALTR) led the Nasdaq higher on reports Intel (INTC) could launch a hostile bid for the chipmaker by June. Intel had signed a standstill agreement with Altera amid previous deal talks which expire on June 1, according to Reuters. Altera spiked 8.3%.
U.S. manufacturing activity held at the year's lows in April. Markit revised its index of U.S. manufacturing conditions to 54.1 in April from 55.7 in March as industrial companies continued to hurt from a stronger dollar.
In a separate report, manufacturing activity held at 51.5 in April, its lowest level since May 2013, according to the Institute for Supply Management index. Economists had expected a reading of 52.
"This was a weak report and the absence of any bounce is a clear indication that the U.S. economic recovery has remained mired in a soft patch," said Millan Mulraine, deputy head of U.S. strategy at TD Securities. "We believe that the case for a mid-year (June or July) hike by the [Federal Reserve] is becoming compromised."