The stock market bounced back from a big loss on Friday after getting a boost from some good first-quarter earnings reports.
Toy maker Hasbro reported an unexpected gain in sales on the back of strong demand for its Transformer, Nerf and Marvel toys. Oil and gas services company Halliburton and investment bank Morgan Stanley also reported results that we're better than analysts were expecting.
Stocks were recovering from a big slump on Friday when worries about the unresolved Greek debt crisis and some disappointing earnings reports rattled financial markets.
This week is one of the busiest for first-quarter earnings with 147 companies, close to one-third of those in the S&P 500, scheduled to report their results. Investors are already expecting weak earnings because a surge in the dollar is hurting overseas sales. A big drop in oil prices is also hitting energy companies.
The strong earnings Monday “are setting a good trend to start the week,” said David Lyon, a global investment specialist at JPMorgan Private Bank. “Earnings are coming in better than the weakened expectations.”
The Standard & Poor's 500 index climbed 19.22 points, or 0.9 percent, to 2,100.40. The Dow Jones industrial average gained 208.63 points, or 1.2 percent, to 18,034.93. The Nasdaq composite climbed 62.79 points, or 1.3 percent, to 4,994.60.
Currently, analysts are predicting earnings per share will slide by an average of 2.6 percent for S&P 500 companies in the first quarter, according to S&P Capital IQ data. If that forecast holds, it will mark the first period that earnings have contracted since the third quarter of 2009, when the U.S. was emerging from the Great Recession.
On Monday, though, the reports were better than forecast.
Hasbro was the biggest gainer in the S&P 500 index after reporting better-than-expected earnings. The company is battling a shift toward video gaming, but unexpectedly reported rising revenue for the first quarter. The stock jumped $8.27, or 13 percent, to $74.16.
Halliburton was another company to gain after posting earnings that beat expectations.
The company reported a $643 million loss for the first quarter, but after asset write-offs, severance costs and other items had been accounted for, the company logged earnings per share of 49 cents. Halliburton's stock rose 96 cents, or 2 percent, to $47.85.
Stocks have moved between big upswings and losses for much of the year, and the S&P 500 has gained only 2 percent so far in 2015.
Not all investors are positive on the near-term outlook for stocks. Michael Scanlon, a senior investment analyst at John Hancock Asset Management, says stocks will likely continue to struggle to advance as long as the debt situation in Greece remains unresolved and earnings at U.S. companies remain weak.
“I feel like the first half of this year … is going to turn out to be a pretty bumpy period for equities,” said Scanlon.
In government bond trading, prices edged lower. The yield on the benchmark 10-year Treasury note rose to 1.88 percent from 1.86 percent on Friday.
In currency trading, the euro weakened to $1.0737 from $1.0805 on Friday. The dollar rose to 119.24 yen from 118.94 yen
U.S. crude oil rose 64 cents to close at $56.38 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, was unchanged at $63.45 a barrel in London.
In metals trading, silver fell 34 cents, or 2.1 percent, to $15.89 an ounce. Gold dropped $9.40, or 0.8 percent, to $1,193.50 an ounce. Copper also dropped, falling 4.2 cents, or 1.5 percent, to $2.73 a pound.
In other futures trading on the NYMEX:
— Wholesale gasoline rose 1.6 cents to close at $1.932 a gallon.
— Heating oil fell 0.5 cent to close at $1.877 a gallon.
— Natural gas fell 9.8 cents to close at $2.536 per 1,000 cubic feet.