Stocks shook off last week's doldrums and finished sharply higher Monday, driven by a round of corporate deal news and strong earnings from Citigroup.
The major indexes rose in premarket trading as investors digested Citigroup's earnings. They opened in the green and held steady through the entire session.
The Standard & Poor's 500 index rose 9.53 points, or 0.5 percent, to 1,977.10. The index is down 0.4 percent from its most recent high of 1,985.44, set July 3.
Nine of the 10 sectors in the S&P 500 rose, led by energy stocks. Utilities fell the most.
The Dow Jones industrial average added 111.61 points, or 0.7 percent, to 17,055.42. The Dow is down slightly from its July 3 record of 17,068.65.
The Nasdaq composite gained 24.93 points, or 0.6 percent, to 4,440.42.
The three stock indexes are all up for the year.
Investors cheered AECOM Technology's $4 billion acquisition of engineering and construction services company URS Corp., sending URS' stock up 11.6 percent and AECOM's up 8.6 percent.
Citigroup rose 3 percent after the bank turned in better-than-expected results and disclosed it has agreed to pay $7 billion to settle a federal investigation of its mortgage securities business. JPMorgan Chase & Co. and Goldman Sachs, due to report earnings today, also got a lift.
All told, the three major stock indexes notched their second gain in two days. That's a turnaround from last week, when the S&P 500 index lost 0.9 percent, its worst showing since April.
Concern about Portugal's Espirito Santo International, which reportedly missed a debt payment last week, harked back to issues that spawned Europe's debt crisis.
On Monday, investors appeared to be reassured any problems would be contained.
"Investors are saying if this Portugal thing really isn't significant from an impact standpoint, and the earnings are coming in good ... stocks ought to be going higher," said Phil Orlando, chief equity strategist at Federated Investments.
The yield on the 10-year Treasury note rose to 2.54 percent from 2.52 percent late Friday.
With the market trading near highs, investors will be focused this week on a large number of corporate earnings, including quarterly reports from General Electric, Google, Bank of America and Johnson & Johnson.
So far, investors like what they see.
"We got started off with a very good report out of Citibank this morning," Orlando said. "And economic news this week -- retail sales, capacity utilization, housing data, confidence data -- is all supposed to be pretty good."
Recent data point to an improving U.S. economy after a slow start this year.
Employers added 288,000 jobs last month, the fifth straight month of gains above 200,000. And the national unemployment rate slid to 6.1 percent, a 5 1/2-year low.
More people with jobs means more paychecks, which could enhance consumer spending and growth.
"You're starting to stack up some fairly impressive jobs numbers," said Liz Ann Sonders, chief investment strategist at Charles Schwab & Co. "There's a lot of momentum to this market."
Business on 07/15/2014