Energy stocks led indexes higher Monday on the first day of trading since the growing unrest in Egypt sent stocks to their biggest one-day drop in more than three months.
Exxon Mobil Corp. rose 1.5 percent after it reported that its quarterly profit beat Wall Street's expectations. Massey Energy Co. jumped 16 percent after Alpha Natural Resources Inc. said that it would buy the coal producer in a $7.1 billion deal. Alpha Natural Resources fell 6 percent.
The Massey deal suggests "maybe coal isn't dead," said Kim Caughey Forrest, equity research analyst at Fort Pitt Capital Group. It also raises hopes for similar deals in the future, she said.
Concerns remained over Egypt's impact on oil prices, especially if the Suez Canal, a key route for oil tankers and cargo ships, may be closed. Crude oil prices rose 3 percent to $92 a barrel.
"The market wants to work its way higher," said Sam Stovall, chief investment strategist of Standard & Poor's. "The big worry is the unknown — the cascading effects that could occur."
According to preliminary calculations, the Dow Jones industrial average gained 68.23 points, or 0.58 percent, to 11,891.93. The broader Standard and Poor's 500 index rose 9.78, or 0.77 percent, to 1,286.12. The Nasdaq composite index gained 13.19, or 0.49 percent, to 2,700.08.
Intel Corp. fell 1.6 percent after the company said it will discontinue the production of one of its computer chips because of a design flaw. That was the largest fall among the 30 stocks that make up the Dow.
Eight of the 10 company groups that make up the S&P index rose. Energy companies gained 2.3 percent, the most of any group.
Bond prices fell slightly, sending their yields higher. The yield on the benchmark 10-year Treasury note rose to 3.39 percent from 3.33 percent late Friday. Bond prices rose Friday because investors sought less risky assets.
Stronger economic data in the U.S. helped push stocks higher. The Commerce Department reported that consumers increased their spending in December faster than analysts had predicted. Spending for all of 2010 rose at the fastest pace in three years.
Stocks fell broadly Friday due to escalating protests in Egypt and disappointing earnings reports from Amazon.com Inc. and Microsoft Corp. The Dow fell 166.13 points, or 1.4 percent, to close at 11,823.70.
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The S&P index on Friday fell 23.20, or 1.8 percent, to 1,276.34. That was the broad market index's largest fall since August 11. The Nasdaq composite fell 68.39, or 2.5 percent, to 2,686.89.
