* Turmoil abroad unlikely to hit U.S. economy - Yellen
* Nasdaq biotech index hits record high on Celgene deal
* Bank of America rises after profit more than doubles
* Macy’s rises after Starboard announces stake
* Indexes up: Dow 0.07 pct, S&P 0.09 pct, Nasdaq 0.16 pct (Updates to early afternoon)
By Tanya Agrawal
July 15 (Reuters) - U.S. stocks were marginally higher in afternoon trading on Wednesday, set for a fifth straight day of gains, after Federal Reserve Chair Janet Yellen said the turmoil abroad was unlikely to affect the U.S. economy and that the Fed was on track to raise interest rates this year.
Bank of America rose 3 percent to $17.66, poised for its best day in five months, after reporting its biggest quarterly profit in nearly four years. The stock was the biggest boost to the S&P 500 financial index, which was the top gainer among the 10 major S&P 500 sectors.
Celgene jumped as much as 10.7 percent to a record high of $135.98 after the company said it would buy Receptos to get a potential multibillion-dollar drug. Celgene’s gains helped push the Nasdaq biotech index to hit a record high for the third time in three weeks.
Yellen said she expects the economy to grow steadily for the rest of the year, allowing the Fed to hike rates, but gave no direct hint on the timing or pace of a hike. The Fed is broadly expected to hike rates in September or December.
“A rate hike will be additive to the U.S. equities as the U.S. economy requires something other than crisis-era rates,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis.
“The pace of the rate hike is more important than the timing of it as investors remain in pause mode with a modest downward basis.”
At 12:43 p.m. ET (1643 GMT), the Dow Jones industrial average was up 11.95 points, or 0.07 percent, at 18,065.53 and the Nasdaq Composite was up 8.24 points, or 0.16 percent, at 5,113.13.
The S&P 500 was up 1.94 points, or 0.09 percent, at 2,110.89, just 1 percent away from its May record high of $2134.72.
Five of the 10 major S&P 500 sectors were lower, with the energy index’s 0.97 percent fall leading the decliners. Oil prices fell as traders took profits from the past two days of gains.
Corporate America is expected to report its worst sales decline in nearly six years in the second quarter, while profit is expected to have fallen 2.9 percent, according to Thomson Reuters estimates. The effect of the uncertainty in the Chinese markets and the strong dollar will also be in focus.
Yum Brands fell 2.9 percent to $89.37 after the owner of Pizza Hut and KFC reported its fourth straight quarter of falling sales, indicating it is still struggling to regain lost ground in China after a food scandal last year.
Macy’s jumped as much as 7 percent to $71.35 after investment firm Starboard Value said it had taken a stake in the retail chain.
Netflix was down 1.6 percent at $98.71 in its first day of trade after a seven-for-one stock split. Netflix and Intel are scheduled to report after the markets close.
Declining issues outnumbered advancers on the NYSE by 1,756 to 1,195. On the Nasdaq, 1,615 issues fell and 1,077 advanced.
The S&P 500 index posted 27 new 52-week highs and seven new lows, while the Nasdaq recorded 121 new highs and 41 new lows. (Editing by Savio D‘Souza)