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S&P 500, Dow and Nasdaq gain as companies start reporting earnings

Damian J. Troise

NEW YORK — Stocks surged in morning trading on Wall Street on Monday and marked the latest about-turn in a market that swings unsteadily between gains and losses.

The S&P 500 was up 2.9% at 10:22 a.m. EST. Almost all stocks in the benchmark gained ground. The Dow Jones Industrial Average rose 606 points, or 2.1%, to 30,232 and the Nasdaq rose 3.3%.

Technology and communications companies show some of the biggest gains. Google’s parent company rose 3.9%.

Bond yields retreated from multi-year highs and eased pressure on equities. The 10-year Treasury yield, which influences mortgage rates, fell to 3.97% from 4.02% on Friday evening. The 2-year Treasury yield, which tends to track expectations of future Federal Reserve action, fell to 4.44% from 4.50% late Friday.

UK government bonds rallied after news that the country’s new Treasury chief was scrapping nearly all of a series of unfunded tax cuts announced last month that had rattled markets.

European markets were generally up and most Asian markets gained ground. Oil prices rose 1.3%.

Corporate earnings, the Fed and inflation are the main drivers

The broader market is coming off an extremely volatile week that ended with most major indices in the red. Investors remain concerned about runaway inflation and the possibility of a recession hitting the US and global economy. The big concern is the Fed’s aggressive policy to raise interest rates curb inflation, which could go too far and slow the economy so much that it slipping into a recession.

Wall Street is focusing this week on the latest round of corporate financial results. Earnings reports and financial updates could help give investors a clearer picture of how businesses and consumers have handled inflation. Investors will also listen carefully to any statements from business leaders focusing on the potential path of inflation and the expected impact on business.

Bank of America jumped 5.6% after reporting better-than-expected earnings.

Several major airlines, which could face turmoil in their finances if inflation hits consumer travel spending, will release their results this week. United Airlines reports results on Tuesday, followed by American Airlines on Thursday.

Johnson & Johnson, Netflix, Union Pacific and American Express are other big names reporting earnings this week.

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Several companies gained traction Monday on a mix of specific company news. Oil producer Continental Resources jumped 8% after saying it would be taken private under a deal with founder Harold G. Hamm.

Investment bank Credit Suisse rose 4% after agreeing to pay $495 million as part of a settlement in a dispute with the United States over mortgage-backed securities.