A big factor driving the Standard & Poor's 500 up 9.6 percent this year has been optimism that it will be a good one for company profits. Though expectations for the first quarter are relatively modest, many investors expect to see more of a pickup in earnings later in the year.
"We need to see some earnings growth here to justify the big gains we've seen in the first quarter," said Ryan Detrick, a senior technical analyst at Schaeffer's Investment Research.
Earnings for companies in the S&P 500 index are expected to rise by 0.7 percent from the first quarter of last year, but that growth is expected to accelerate sharply to 13 percent in the final three-month period of the year, according to data from S&P Capital IQ.
On Monday, the Dow Jones industrial average rose 48.23 points, or 0.3 percent, to close at 14,613.48. The index started the day lower and fell as much as 67 points during morning trading. Alcoa's gain of 1.8 percent was one of the biggest in the Dow. It rose 15 cents to $8.39.
The S&P 500 index closed up 9.79 points, or 0.6 percent, at 1,563.07.
The Nasdaq composite index rose 18.39 points, or 0.6 percent, to 3,222.25.
Telecommunications stocks fell 0.5 percent, and health-care stocks inched up just 0.2 percent, lagging the rest of the market. The two industry groups have performed well this year as investors sought out less risky stocks that pay good dividends. Health-care companies are up almost 16 percent, best in the S&P 500.
On Monday, Lufkin Industries, an oilfield-equipment maker, surged $24.03, or 38 percent, to $87.96 after General Electric Co. agreed to buy the company for $3 billion. GE wants to bolster its oil and gas operations; its stock rose 19 cents, or 0.8 percent, to $23.12.
Johnson & Johnson logged the biggest percentage decline on the Dow, dropping 93 cents to $81.11. Analysts at JPMorgan cut their rating on the stock to "neutral," saying it has risen too far, too fast.
J&J is up 16 percent this year.