Nasdaq posts first 5-day winning streak since May, Facebook rises more than 4%
The Dow Jones Industrial Average climbed 60 points, led by gains in Disney. The S&P 500 rose 0.4 percent, as energy and financials. The Nasdaq Composite advanced 0.8 percent as Facebook shares gained 3.5 percent.
Facebook rose on reports that the social media giant is in talks with banks to incorporate users' financial information into Messenger.
Cardinal Health and Tyson Foods reported better-than-expected corporate earnings before the bell. Shares of Tyson Foods rose more than 3.5 percent, while Cardinal Health's stock gained 1 percent. Berkshire Hathaway posted stronger-than-forecast quarterly profit on Friday, sending its Class B shares up by 3.7 percent.
"The positive surprises in the earnings season are strong and that's helping the overall sentiment in the market," said Quincy Krosby, chief market strategist at Prudential Financial. The biggest takeaway from this earnings season is that "tax cuts were clearly a positive for the bottom line but ... the top line has also been good."
This earnings season has been stronger than analysts had expected. Of the S&P 500 companies that had reported through Friday, 80 percent have posted better-than-expected profits, according to FactSet. If that number stays there or moves above 80 percent, it would be the highest percentage of companies to beat expectations since FactSet started tracking the data in 2008.
Investors came into this earnings season with high hopes as FactSet had forecast year-over-year profits to grow by 20 percent in the second quarter. So far, second-quarter earnings have grown by 24 percent through Friday.
A senior Trump administration official told CNBC that the White House is not ruling out slapping auto tariffs on Canada. The suggestion comes as NAFTA negotiations continue with Canada on the sidelines. It also comes as President Donald Trump is considering raising proposed tariffs on $200 billion in Chinese goods to 25 percent from 10 percent.
Late last week, China said it was ready to retaliate with tariffs on around $60 billion worth of U.S. goods, amid a mounting trade war. Beijing added that import taxes would be within the range of 5 percent to 25 percent in rates, with many of the goods listed linked to agriculture.
The Federal Reserve is expected to raise rates twice more this year. Last week, the U.S. central bank kept rates unchanged but upgraded its view of the economy to "strong." The Fed's upgraded view on the economy comes after the Commerce Department said the U.S. economy expanded by 4.1 percent in the second quarter. It also came days before the Labor Department released solid data on the labor market.
Equities came into Monday's session after posting weekly gains last week. The S&P 500 and Dow rose 0.8 percent and 0.1 percent last week, respectively, and notched their fifth straight weekly gain. The Nasdaq Composite gained nearly 1 percent last week.
PepsiCo announced Monday that CEO Indra Nooyi will step down from her post after 12 years. President Ramon Laguarta will succeed Nooyi as the next chief executive. PepsiCo shares rose 0.6 percent.
—CNBC's Michael Sheetz contributed to this report.