Wall Street rose on Monday as prices of oil and other commodities surged, pointing to an uptick in investors' risk appetite following a rout in global markets.
The recovery in prices of crude and metals comes on the heels of better-than-expected U.S. jobs and inflation data, which has helped stabilise the market.
Gains were broad-based, with all 10 major S&P sectors higher. Including Monday's gains, the S&P 500 is up 4.1 percent in the past 5 days.
However, the index is still down about 5 percent for the year, moving lock-step with oil prices, which are hovering near 12-year lows.
"Sentiment is clearly on edge and I think the market's move has been outsized, relative to actual changes in fundamentals," said Aaron Clark, a portfolio manager at GW&K Investment Management in Boston.
"I think it's more of a growth scare which is getting magnified by the moves in financial markets," he said, adding that the prevailing uncertainty would add to volatility.
U.S. crude prices were up more than 7 percent, while prices of industrial metals such as copper and zinc rose as investors worried about potential shortages.
At 12:36 p.m. ET (1736 GMT), the S&P 500 was up 25.55 points, or 1.33 percent, at 1,943.33, just shy of its 50-day moving average, a key technical level.
The Dow Jones industrial average was up 221.2 points, or 1.35 percent, at 16,613.19, and the Nasdaq Composite index was up 65.51 points, or 1.45 percent, at 4,569.94.
The S&P energy sector rose 2.15 percent, boosted by Chevron's 2.7 percent increase. Materials was up 1.91 percent. Dow Chemicals and Freeport-McMoRan were the biggest influences.
Investors are also keeping a close eye on the U.S. Federal Reserve for its next move on interest rates.
While Fed Chair Janet Yellen has indicated the central bank would stick to its rate hike programme, policymakers appear at odds and traders have all but given up on a hike this year.
Shares of Fitbit were up 3.7 percent at $16.18 ahead of its results later in the day.
UnitedHealth, Anthem, Humana, Aetna and other insurers were up after the U.S. government proposed raising payments to health insurers who offer Medicare Advantage health benefits to elderly and disabled Americans.
UnitedHealth was up 3.6 percent, providing the biggest boost to the Dow.
Advancing issues outnumbered decliners on the NYSE by 2,482 to 514. On the Nasdaq, 2,026 issues rose and 678 fell.
The S&P 500 index showed 17 new 52-week highs and one new low, while the Nasdaq recorded 35 new highs and 26 new lows.
(Reporting by Abhiram Nandakumar in Bengaluru; Editing by Saumyadeb Chakrabarty)
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Published Date: Feb 23, 2016 00:00 AM | Updated Date: Feb 23, 2016 00:00 AM