NEW YORK (TheStreet) -- Stocks closed their first day of trading in June with slight gains as a range of data from the ISM Manufacturing Index to U.S. personal income underlined recent signs of a strengthening economy.
The S&P 500 was up 0.2%, the Dow Jones Industrial Average added 0.16%, and the Nasdaq gained 0.25%. Benchmark indexes closed with gains for the first time in three sessions.
The ISM Manufacturing Index increased to 52.8 in May from 51.5 in April, above estimates of 51.8. That marked its highest level since February. Separately, construction spending increased 2.2% compared to an expected 0.7% gain.
Like all recent data, investors sought to determine what renewed strength might mean for the Federal Reserve's rate hike timeline. Consensus is for a 25-basis-point rate increase from the Fed as soon as the third quarter.
"The Fed has been trying to prepare the markets for the first rate hike for six months now and they have kind of put themselves into a corner where if they don't do at least one small interest rate increase this year, they risk their credibility," said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research, in a call.
U.S. personal income in April increased 0.4% after a flat reading a month earlier. Economists had expected the measure to tick up 0.3%. Personal spending remained flat, as expected, after a revised 0.5% increase in March.
The focus this week will be on economic data, culminating in Friday's closely watched jobs numbers. Economists hope to see continued strength in the labor market, proof that March's disappointing number was an aberration in a weak first quarter.
Expectations are for the U.S. to have added 210,000 jobs in May with the unemployment rate remaining unchanged at 5.4%. Hourly earnings are forecast to increase 0.2% month on month.
Aside from Friday's jobs report, April factory orders will be released Tuesday, and the trade balance for April will be released Wednesday. The Fed's Beige Book, an anecdotal report of the 12 Federal Reserve districts, will be released on Wednesday afternoon.
The technology sector was the best performer on markets, led by Microsoft (MSFT) and Altera (ALTR). Microsoft added 0.87%, caught up in a broader tech rally. The tech giant announced it will release its new operating system, Windows 10, on July 29.
Altera jumped after Intel (INTC) announced it was buying the chipmaker for $54 a share, or $16.7 billion in cash. Intel fell 1.7%, the worst performer on the Dow, while Altera climbed nearly 6%. Click here for more.
GoPro (GPRO) rallied as the action camera maker announced the availability of its new Hero+ LCD camera, which is $100 less than its Hero4Silver model. The camera includes a touch display and a new in-camera video trimming feature. Click here for more.
Walt Disney (DIS) shares were among the best performers on the Dow after Chief Financial Officer James Rasulo stepped down, effective June 30. A new finance chief will be named at a later date with Rasulo to stay on board long enough to assist with the transition.
SINA (SINA) surged after the Chinese media company announced its Chairman and CEO Charles Chao would purchase 11 million shares in a transaction valued at $456 million.
OM Group (OMG) rocketed 28.2% higher after funds managed by affiliates of Apollo Group (APO) agreed to purchase the specialty chemicals developer for $34 a share, 28% higher than Friday's close. Apollo plans to spin off OM's electronic chemicals and photomasks units to Platform Specialty Products (PAH) for $365 million in cash.
Citigroup (C) shares were on watch on reports the bank could close its Banamex USA unit after federal authorities announced an investigation into possible money laundering violations. Regulators reportedly want the unit to pay more than $100 million to settle allegations, according to Reuters.
Four clinical trials involving the checkpoint inhibitors from Merck (MRK) and Bristol-Myers Squibb (BMY) showed promising signs of efficacy in a wide range of solid tumors. Bristol-Myers shares were 3.2% higher. Click here for more.
Lumber Liquidators (LL) shares were on watch after the company responded to inquiries as to why it relabeled certain engineered hardwood flooring products. The company said it did so because a supplier mislabeled some California Air Resources Board compliance numbers on some products, though said they remained CARB Phase II compliant.
Stocks closed Friday's session lower after a downward first-quarter GDP revision pressured markets. Benchmark indexes, however, notched a gain for May. Click here for more.