The sector led the gains on the Standard & Poor's 500, rising 1.1% with semiconductor names aiding the advance. Materials rose 1% while health care and industrials were both 0.8% stronger.
The Commerce Department said late Monday it would issue a temporary general license to amend the export administration regulations authorizing "specific, limited engagement" involving Huawei.
Chip stocks had been dented by last week's restrictions on the Chinese tech giant, and on Tuesday Western Digital (WDC) gained 2.8%, Xilinx (XLNX) rose 2.4% and Analog Devices (ADI) added 2.2% on the upbeat day for the semiconductor group.
While chip names aided the Nasdaq Composite's advance, the gains were capped by a loss of 2.5% in Tesla (TSLA) after Morgan Stanley slashed its bear case price target to $10 from $97 amid worries about the market in China.
Kohl's (KSS) sank 12% after cutting its full-year earnings guidance after a downbeat start to the fiscal year with lower-than-expected first-quarter results. TJX Cos. (TJX) fell 2.6% even after the TJ Maxx parent reported results that were ahead of views.
In other company news, CIRCOR (CIR) surged 42% after Crane (CR) said its offer to buy the maker of engineered products for $45 a share was declined. Crane fell 4.9%.
In morning trading, the Nasdaq rose 0.8%, the S&P 500 added 0.7% and the Dow was up 0.5%.
Globally, the FTSE 100 added 0.2%, the Shanghai Composite jumped 1.2%, the Hang Seng slipped 0.5% and the Nikkei 225 slipped 0.1%.
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