However, stocks have not yet priced in a rate hike in June or even July, according to analysts at Bank of America/Merrill Lynch.
New York: US stocks rose on Monday, rebounding from losses last week, as financials gained with Berkshire Hathaway and weakness in the dollar eased worries about earnings for multinationals.
The Nasdaq snapped a seven-session losing streak, though Apple fell for an eighth straight session, its longest run of losses since mid-1998.
Gains in consumer shares also lifted stocks, which on Friday had posted their largest weekly drop in more than two months. Amazon shares jumped 3.7% to US$683.85, giving the S&P 500 and Nasdaq their biggest boosts, while both the consumer discretionary sector and staples gained more than 1% each.
The dollar index fell 0.5% and is down 6.1% for the year so far, a trend that should bode well for US companies with a lot of overseas sales.
"It seems like the weak dollar superseded everything today, and we've got people coming in to buy stocks," said Bucky Hellwig, senior vice-president at BB&T Wealth Management in Birmingham, Alabama. "The weaker dollar helps companies that do business abroad."
While first-quarter earnings from S&P 500 companies have mostly beaten analysts' expectations, they are still estimated down 5.7% from a year ago, according to Thomson Reuters data.
Berkshire Hathaway, was up 0.6% following its annual shareholder meeting on Saturday, while the financial sector climbed 1.1%.
The Dow Jones industrial average closed up 117.52 points, or 0.66%, to 17,891.16, the S&P 500 gained 16.13 points, or 0.78%, to 2,081.43 and the Nasdaq Composite added 42.24 points, or 0.88%, to 4,817.59.
Recovering oil prices and an accommodative Federal Reserve have helped the S&P 500 rise roughly 14% since mid-February.
US manufacturing activity rose for the second straight month in April, but at a slightly slower pace. The Institute for Supply Management (ISM) said its index of national factory activity slipped to 50.8 last month from 51.8 in March.
A report from the Commerce Department showed construction spending rose to an 8-1/2-year high in March.
Baker Hughes shares fell 2% to US$47.40 after scrapping a deal to merge with larger rival Halliburton. Halliburton rose 1.8% to $42.05.
Apollo Education shares jumped 12.4% to US$8.77 after a group of investors raised their offer to US$1.14 billion to buy the for-profit education provider.
About 7.1 billion shares changed hands on US exchanges, even with the daily average for the past 20 trading days, according to Thomson Reuters data.
NYSE advancing issues outnumbered decliners 1,903 to 1,109, for a 1.72-to-1 ratio on the upside; on the Nasdaq, 1,674 issues rose and 1,165 fell for a 1.44-to-1 ratio favouring advancers.
The S&P 500 posted 15 new 52-week highs and 3 new lows; the Nasdaq recorded 62 new highs and 35 new lows. - Reuters
Win a prize this Mother's Day by subscribing to our annual plan now! T&C applies.
