Stocks extended gains by mid-morning Monday as crude oil spiked on signs of reduced output out of Russia.
The S&P 500 was up 0.66%, the Dow Jones Industrial Average climbed 0.82%, and the Nasdaq added 0.87%.
Crude broke free from range-bound trading to trade at its highest since March 23 after Russia said it anticipates flat crude output next year. Russian Energy Minister Alexander Novak said that output would likely increase in 2016 but would level out by 2017. West Texas Intermediate crude oil added 2% to $40.50 a barrel.
However, investors remained wary ahead of a weekend meeting of the Organization of Petroleum Exporting Countries. Commodity traders hope OPEC members can agree upon a production freeze when they meet on April 17 in Doha, Qatar.
The reporting season will kick off in earnest after markets close Monday when unofficial bell-ringer Alcoa (AA - Get Report) reports. Overall first-quarter earnings for companies in the S&P 500 are expected to fall 7.9%, their third straight quarter in decline and their worst losing streak since mid-2009. Excluding the energy sector, earnings are forecast to fall 3.6%. Only three S&P 500 sectors are expected to have positive earnings growth: consumer discretionary, telecommunications, and health care.
"If analyst estimates are correct, it is likely to be the worst quarter of EPS results for the index thus far this cycle," Wells Fargo analysts wrote in a note. "Results from the energy sector remain troubling for index earnings at large."
Tesla (TSLA - Get Report) added 2.2% ahead of a midday conference call with investors to give "an update" on the company. The automaker recently announced it had received 325,000 pre-orders for its latest vehicle, the Model 3. The vehicle reservations amount to $14 billion in implied future sales. The new model, which will not be out until late 2017, sells for $35,000, appealing to a wider market than Tesla's more expensive vehicles.
Canadian Pacific (CP - Get Report) climbed 4% after walking away from its bid to purchase Norfolk Southern (NSC - Get Report) . The U.S. Justice Department recently had called for a third-party regulator to reject a proposed voting trust arrangement in the terms of the deal. The company had offered an unsolicited bid of $28 billion for the fourth-largest railroad company in the U.S. around six months ago.
Hertz (HTZ - Get Report) tumbled 5.3% after warning that it anticipates revenue from car rentals in the U.S. to be weaker than expected this year. The car-rental company expects revenue per available car day to fall between 2.5% and 3.5% in the first quarter and to come in flat or down 1.5% for the full year.
Valeant Pharmaceuticals (VRX) was slightly higher despite news that CEO Michael Pearson has been subpoenaed on an investigation into price increases for certain prescription drugs. Pearson will be questioned by the Senate Committee on Aging before an April 27 hearing.
Yahoo! (YHOO) added 1.7% after the U.K.'s Daily Mail confirmed Monday it's a suitor for the Internet company's assets. The newspaper joins a number of interested companies, most notably Verizon (VZ - Get Report) , which will tender preliminary offers by the April 18 deadline.
"I like the fact that this is the first piece to acknowledge that a weaker dollar might play a role in a potential upside surprise," said TheStreet's Jim Cramer, portfolio manager of the Action Alerts Plus charitable trust. "I do want to see some growth in Youtube, though."