* S&P 500 inches closer to all-time intraday high
* Healthcare stocks rally, Humana is S&P's top percentagegainer
* Indexes up: Dow 0.5 pct, S&P 0.4 pct, Nasdaq 0.4 pct
By Caroline Valetkevitch
NEW YORK, April 2 (Reuters) - U.S. stocks rose on Tuesday,moving the S&P 500 closer to its all-time intraday high, asincreased payment rates for some health insurers boosted thesector and Cyprus concluded bailout talks.
The U.S. government dropped plans to cut payments forprivate Medicare Advantage insurers and instead said it wouldallow a 3.3 percent raise.
Shares of Humana, which derives about two-thirds ofits revenue from Medicare Advantage business, jumped 6.2 percentto $79.64 and was the biggest percentage gainer on the S&P 500.UnitedHealth Group gained 6.2 percent to $62.67.
"They didn't expect the result that they got. That will helpwith their bottom line," said Quincy Krosby, market strategistat Prudential Financial in Newark, New Jersey.
Stocks also gained because "Cyprus was given a reprieve,"she said.
Cyprus's deal, which still requires ratification, would meanthe country receives a 10 billion euro loan and will have until2018 to carry out measures to shore up its finances. Thecountry's finance minister resigned after concluding the deal.
The S&P 500 last Thursday set an all-time closing high buthas been unable to reach its intraday record of 1,576.09, alevel that analysts say could draw in even more investors.
The Dow Jones industrial average was up 72.46 points,or 0.50 percent, at 14,645.31. The Standard & Poor's 500 Index was up 6.91 points, or 0.44 percent, at 1,569.08. TheNasdaq Composite Index was up 14.32 points, or 0.44percent, at 3,253.50.
Healthcare sector stocks are still seen as cheap relativeto the overall market. Humana, which has a market cap of about$11.9 billion, has a forward price-to-earnings ratio of 9.4,below the S&P 500 P/E average ratio of about 16.5. UnitedHealthhas a P/E ratio of 10.6 and Cigna has a P/E ratio of 9.7.
"We do think that healthcare stocks are a nice combinationof dividend yields, growth and low valuations and we are veryconstructive on the sector," said Jim Russell, senior equitystrategist for U.S. Bank Wealth Management in Cincinnati.
The broad market's rise countered Monday's sell-off. Mostinvestors expect moves to be limited this week before Friday'sU.S. monthly payrolls report.
The March jobs report could give clues on how successful theFederal Reserve has been in lowering unemployment, one of theprimary headwinds for the economy. About 200,000 jobs werecreated last month, according to a Reuters poll, down from236,000 in February.
In an effort to bring down the unemployment rate, the Fedhas maintained an accommodative monetary policy, which has alsobenefited stocks.
Strengthening U.S. data has also helped stocks. AmongTuesday's reports, February factory orders rose 3 percent,slightly above expectations.
A weak reading on U.S. manufacturing on Monday sparked apullback in stocks.
Other gainers included Hertz Global Holdings shares,which rose 7.6 percent to $23.58 after the company forecaststrong earnings and revenue through 2015 due to increasingglobal demand for car rentals and benefits from its recentlycompleted acquisition of Dollar Thrifty.
Also in the healthcare sector, shares of Cigna wereup 3.5 percent at $65.10.
Among decliners, Delta Airlines Inc shares were off6.6 percent at $15.20. Delta's unit revenue for March rose 2percent from a year earlier but was below its forecast due tolower-than-expected demand and temporary inefficiencies duringimplementation of new technology.
Shares of Nasdaq OMX Group Inc. plunged 11.4percent to $28.36 after agreeing to buy a BGC Partners Inc. trading platform. BGC shares were up 46.8 percent at$5.65.
Shares of Hewlett-Packard fell 5.7 percent to $21.99after Goldman Sachs downgraded them to "sell."
Vodafone (VOD)