Stocks shot higher on Monday as investors celebrated positive results from retailers along with merger news in the airline and shipping sectors.
The Dow Jones industrial average added 112.17 points, or 1.11%, to 10,252.29. The broader Standard & Poor's 500 index gained 11.69 points, or 1.01%, to 1,165.69. The Nasdaq composite index moved up 17.65 points, or 0.89%, to 1,994.43.
Looking ahead to Tuesday, the economic news calendar is stacked. Most investors will be looking for April's wholesale inflation figure. The producer price index (PPI) is seen rising by 0.3%, vs. 0.7% in the previous month. Stripping out volatile food and energy prices, the PPI is seen rising by 0.2%, vs. 0.1% in April.
Also to be released are housing starts, with new home construction seen rising to an annualized pace of 1.990 million units in April vs. 1.837 million units in the previous month. Industrial production, meantime, is expected to increase by 0.1% in April vs. 0.3% in March.
Tuesday will also be a busy session on the earnings front. Scheduled to report are retailers Staples (SPLS ), JC Penney (JCP ), and Dow component Home Depot (HD ). Tech outfits Hewlett-Packard (HPQ ), another Dow member, and Applied Materials (AMAT ) are also set to release results.
Among sectors on the move on Monday, home improvement and other retail groups were rising after Lowe's (LOW ) posted higher quarterly earnings. Energy and commodity stocks were extending losses as most oil and metals futures fell to multi-month lows. Crude oil fell 51 cents Monday, to $48.16 a barrel.
In U.S. merger news, struggling airline US Airways and America West Holdings (AWA ) are in advanced talks to merger, according to a Wall Street Journal report.
Meantime, package-delivery company United Parcel Service (UPS ) is buying trucking firm Overnite (OVNT ) for about $1.25 billion in cash.
The Dow was pushed higher by Citigroup's (C ) financial newsweekly Barron's said the largest U.S. bank's dividend is likely to rise in the next year and its stock price could rise 20% to more than $55.
Also in the blue chip average, drugmaker Pfizer (PFE ) said Sutent, an experimental cancer drug, reduced tumor growth in patients with a certain type of stomach cancer.
Insurance concern American International Group (AIG ) plans to drive out several senior executives, according to people familiar with the matter, the Wall Street Journal reported Monday.
Limited Brands (LTD ), the name behind Victoria's Secret, Express and Bath & Body Works, posted lower quarterly profit because of weak clothing sales.
In economics news, output for the Federal Reserve's New York region was much lower than expected in May with the Empire State Factory survey data for the month at -11.11 vs a prior 2.03 and expectations of something around 8 to 11. The orders index stayed in negative territory, registering at -7.08 vs a prior -1.22. And the the employment index is now at 0.16 vs 8.50, with prices paid at 42.00 vs 43.09, according to Informa Global Markets.
Treasuries finished narrowly mixed Monday, taking a breather after last week's gains. The yieldon the benchmark 10-year note finished at 4.13%.
European stocks closed lower on Monday. In London, the FTSE 100 was down 2.30 points, or 0.05%, to 4,884.20. BP and Shell Transport were lower as May Brent crude oil futures were a bit lower.
Germany's DAX index fell 13.52 points, or 0.32%, to 4,262.18. Schering was lower after new data from trial on its colon cancer medicine PTK confirmed the pill didn't stop tumor growth.
In Paris, the CAC 40 index lost 6.91 points, or 0.17%, moving to 4,010.98. Altadis was lower as the company's first quarter earnings were a bit lower than analysts had expected.
Asian markets finished lower Friday. Japan's Nikkei 225 index fell 101.89 points, or 0.92%, to 10,947.22, weighed down by worries about the economic outlook ahead of the first quarter gross domestic output data due on Tuesday. But the index's slide was curbed by gains in tech stocks after U.S. peers recovered late last week.
In Hong Kong, markets are closed for a public holiday to mark Buddha's birthday. Trading will resume on May 17.