NEW YORK (TheStreet) -- Stocks extended session highs by mid-afternoon Tuesday as markets returned from the long Labor Day weekend with hopes of further monetary stimulus in China.
The S&P 500 was up 2.2%, and the Dow Jones Industrial Average added 2.3%, or 365 points. The Nasdaq gained 2.4% and turned positive for 2015 as tech stocks such as Avago (AVGO) - Get Report and Analog Devices (ADI) - Get Report led the index.
After last week's U.S. jobs report, the focus on Tuesday returned to global events. China's Shanghai Composite closed 2.9% higher on hopes of further monetary stimulus after fresh trade data triggered more worries over the world's second-largest economy. China's exports fell in 5.5%, their second straight month of declines after a 8.3% decline in July. Imports fell 13.8%.
"The bearish case is that slowing growth in China could trigger a global economic downturn at the same time the Federal Reserve may be making a mistake by lifting rates, all set against a backdrop of expensive equity markets. We think this is overly pessimistic," said Robert Doll, chief equity strategist at Nuveen Asset Management.
However, he also noted that "ongoing worries about Chinese growth and Fed policy are likely to keep markets volatile for the near-term."
U.S. markets have endured a wild ride over the past few weeks as investors fretted over the state of the global economy even as the U.S. economy continued to show signs of a robust rebound. Adding to the worry, a September rate hike from the Fedremained in play after a solid jobs report for August on Friday. The S&P 500 and Dow ended last week down 2.6%.
The Fed will meet on Sept. 16-17 to determine whether the U.S. economy is strong enough to withstand a move off of crises-level interest rates.
Twitter (TWTR) - Get Report tumbled more than 2% on news of the latest shakeup to its C-suite of executives. Mike Gupta, senior vice president and former chief financial officer, will act as CFO at tech startup Docker. The search for a permanent CEO is now three months old after Dick Costolo resigned in June.
General Electric (GE) - Get Report maintained gains of 3% after the European Union approved its $17 billion acquisition of Alstom's power business. The approval will allow GE to go ahead with the its biggest ever deal.
In other deals news, Media General (MEG) agreed to acquire magazine publisher Meredith (MDP) - Get Report for $2.4 billion in a cash-and-stock deal. The combination will create the third-largest local TV station owner in the U.S.
Concordia Healthcare (CXRX) agreed to acquire niche pharmaceutical company Amdipharm Mercury from private-equity firm Cinven for $3.5 billion. The deal is expected to close in the fourth quarter.
Strategic Hotels (BEE) jumped nearly 4% after agreeing to be acquired by Blackstone Group (BX) - Get Report in a deal worth around $6 billion. Blackstone will pay $14.25 a share, a 13% premium on the intraday price in July when reports of a deal first broke.
Apple (AAPL) - Get Report shares jumped 2.8% ahead of its hardware event on Wednesday. The tech giant is expected to unveil the updated iPhone 6s and iPhone 6s Plus and a next-generation Apple TV line.
Bank of America (BAC) - Get Report is reportedly increasing efforts efforts to assure shareholders that CEO Brian Moynihan is suitable to also remain in his dual role as chairman. The bank has agreed to a Sept. 22 vote on the matter.
Chinese e-retailer JD.com (JD) - Get Report jumped more than 5% after announcing a share repurchase program of up to $1 billion over the next 24 months. Repurchases will be funded through the company's cash reserves.
Disney (DIS) - Get Report shares were on watch after the company expanded access to its on-demand entertainment to Amazon (AMZN) - Get Report and Microsoft (MSFT) - Get Report . The catalog is also available through Apple's iTunes and Google's (GOOGL) - Get Report Play.