Stocks pared earlier highs Tuesday after the threat of Iranian oil entering the market pulled commodities lower. 

The S&P 500 was up 0.44%, the Dow Jones Industrial Average climbed 0.62%, and the Nasdaq spiked 0.39%.

Crude oil prices fell after the International Energy Agency warned commodities could fall even further this year as the market faces "enormous strain." In its first monthly report of the year, the energy watchdog said new supplies from countries such as Iran will leave the oil market with a surplus of 1.5 million barrels a day over the first half of the year.

The Iranian government ordered oil companies to ramp up production on Monday after sanctions were lifted over the weekend. Iran could add 500,000 barrels a day to its output, a significant increase from its current production of around 2.9 million barrels a day. 

West Texas Intermediate crude oil was down 1% to $29.14 a barrel, hovering at 12-year lows. Oil prices have tumbled 20% so far this year.

Global markets were sharply higher after Chinese economic growth fell as expected. Economic data from the world's second-largest economy frequently has disappointed economists, triggering fears over the intensity of the region's slowdown.

China's economic growth fell to 6.8% in the fourth quarter as trade and consumer spending weakened. The pace was its slowest in six years and pulled 2015 growth down to 6.9%, its weakest level in a quarter-century. However, the measure was as economists had expected and backed up hopes of further stimulus from Chinese officials.

The International Monetary Fund said the global recovery would occur even more slowly than originally expected this year as China GDP continues to slow and oil prices hurt emerging economies. The organization expected a global growth rate of 3.4% in 2016, down 200 basis points from its previous guidance. 

U.S. stocks on Friday plunged as the extreme selloff that has characterized market activity so far this year kicked into high gear again on Friday. Stocks closed out at their lowest levels since August amid a renewed selloff in crude oil prices, fresh fears over China and a smattering of poor economic data out from the U.S.

Tiffany & Co. (TIF - Get Report) was lower after the jeweler announced job cuts and a reduced forecast for the year. The retailer said challenging global economic conditions had pressured consumer spending, while a stronger U.S. dollar continued to reduce overseas sales. 

AIG (AIG - Get Report) shares were 1% higher after activist investor Carl Icahn reinforced his case for a breakup. Icahn wrote in a letter to shareholders that AIG must become a "smaller, simpler company" to compete efficiently as a non-systemically important financial institution. Icahn had previously said the company was "too big to succeed." 

Morgan Stanley (MS - Get Report) shares jumped more than 3% after the bank reported a much better fourth quarter than expected. The company earned an adjusted 43 cents a share, a dime above estimates, while revenue jumped to $7.7 billion, above estimates of $7.6 billion.

Bank of America (BAC - Get Report) also reported a better-than-expected fourth quarter, driven by a 0.7% increase in sales and trading revenue. However, overall sales of $19.8 billion fell short of estimates of $20 billion. Shares added 1.7%.

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Delta Air Lines (DAL - Get Report) fell nearly 1% after missing quarterly estimates on its top- and bottom-lines. The airline generated revenue of $9.5 billion, below estimates, as passenger unit revenue fell 2.5%. Adjusted earnings of $1.18 a share missed by a penny.

UnitedHealth (UNH - Get Report) climbed nearly 1% after a better-than-expected fourth quarter. The health insurer earned $1.40 a share, 2 cents above estimates, on sales of $43.6 billion. However, overall profit was weaker than a year earlier as the company faced major losses on insurance policies sold through Affordable Care Act exchanges.

Twitter (TWTR - Get Report) shares rose slightly after the social network suffered worldwide outages Tuesday morning with Europe one of the hardest hit. Visitors to the Web site, apps and third-party software had no or unreliable access throughout the morning.

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