The Dow Jones Industrial Average rose 128.08 points, or 0.6 percent, to 21,641.25, the S&P 500 gained 10.1 points, or 0.41 percent, to 2,480.01 and the Nasdaq Composite added 11.35 points, or 0.18 percent, to 6,422.16.
Sectors that perform better during positive economic cycles led the way, with energy, materials and financials all rising at least 1 percent.
Sharp gains in oil prices
Financials were boosted by a bullish profit forecast from Citigroup, while a slightly steeper U.S. Treasury yield curve
The future path of interest rates will be in focus on Wednesday with the expected statement from the Federal Reserve.
Investors were also watching a U.S. Senate vote on healthcare legislation for its implications for President Donald Trump’s planned domestic agenda including tax cuts, which has helped support the stock market.
The market’s run to record highs, including a 10.8 percent rise for the S&P 500 in 2017, has left equities relatively expensive and investors counting on earnings to justify the valuations. The S&P 500 is trading around 18 times earnings estimates for the next 12 months, well above their long-term average of 15 times.
With more than one-fourth of the S&P 500 having reported results, earnings are now expected to have climbed 9.1 percent in the second quarter, up from a projection of an 8-percent rise at the start of the month, according to Thomson Reuters I/B/E/S.
Not all earnings news was positive, as 3M Co shares dropped 5.0 percent after the diversified manufacturer’s report. Eli Lilly shares dropped 3.6 percent after the drugmaker outlined a lengthy delay for its experimental rheumatoid arthritis drug.
Freeport-McMoRan Inc shares jumped 14.8 percent, as soaring metal prices and progress in a permit dispute with Indonesia buoyed the world’s biggest publicly traded copper miner.
Advancing issues outnumbered declining ones on the NYSE by a 1.77-to-1 ratio; on Nasdaq, a 1.90-to-1 ratio favored advancers.
(Additional reporting by Tanya Agrawal in Bengaluru; Editing by Anil D’Silva)