Wall Street has ended sharply higher, fuelled by expectations of a coronavirus relief package and by a rally in Amazon, Apple and other technology stocks ahead quarterly earnings season.
Apple Inc jumped ahead of an event on Tuesday, when it is expected to unveil its newest iPhones.
Amazon rallied ahead of its annual Prime Day shopping event on October 13 and 14.
Microsoft also jumped, helping lift the S&P 500 information technology index sharply.
The S&P 500 was about 1.0 per cent below its record closing high from September 2, nearly recovering from most of a 9.0 per cent pullback last month.
“Apple is crushing it. There’s some euphoria around the name,” said Phil Blancato, chief executive of Ladenburg Thalmann Asset Management in New York.
“The market leaders are once again the tech names, supported by the fact that the economy continues to expand.”
Optimistic sentiment dominated after the Trump administration on Sunday called on Congress to pass a stripped-down coronavirus relief bill as negotiations on a broader package ran into resistance.
“It looks like the administration wants a deal done before the election,” said Brian Battle, director of trading at Performance Trust Capital Partners in Chicago.
“Now it’s up to the Republican Senate to figure out how big the number is going to be.”
Many investors view Democratic candidate Joe Biden as more likely to raise taxes and for months have seen a second term for Trump, who favours deregulation, as better for the overall stock market.
However, with growing expectations of a Democratic win in next month’s presidential election, investors are increasingly pointing to potential benefits of a Biden presidency, such as greater infrastructure spending and less global trade uncertainty.
Betting odds aggregated by RealClearPolitics suggest punters see a 67 per cent chance Biden will win and a 33 per cent chance for Trump, the greatest gap so far between the two candidates.
With the October 15 presidential debate officially cancelled, Trump plans to travel to key battleground states this week as his doctor declared he was no longer a transmission risk for the novel coronavirus.
Results from big US banks will be in focus this week, with JPMorgan & Co and Citigroup set to report on Tuesday.
Overall, analysts expect third-quarter earnings for S&P 500 companies to fall 21 per cent from a year earlier, smaller than a 31 per cent slump in the second quarter.
“Earnings are expected to be negative, but I think most people would say, ‘Yes, but we set the bar so low that we will probably beat Q3 numbers the way we beat Q2 numbers’,” said Sam Stovall, chief investment strategist at CFRA in New York.
The Dow Jones Industrial Average rose 250.03 points, or 0.87 per cent, to 28,836.93, the S&P 500 gained 56.93 points, or 1.64 per cent, to 3,534.06 and the Nasdaq Composite added 296.32 points, or 2.56 per cent, to 11,876.26.
The S&P 500 energy index fell as oil prices dropped on easing supply worries.
Twitter Inc jumped after Deutsche Bank upgraded the social media company’s shares to “buy” on expectations of continued growth in 2021.
Volume on US exchanges was 8.2 billion shares, compared with the 9.7 billion average for the full session over the last 20 trading days.
Advancing issues outnumbered declining ones on the NYSE by a 1.79-to-1 ratio; on Nasdaq, a 1.57-to-1 ratio favored advancers.
The S&P 500 posted 71 new 52-week highs and one new low; the Nasdaq Composite recorded 159 new highs and 14 new lows.