By Lewis Krauskopf, Sruthi Shankar and Ankika Biswas
(Reuters) - Major U.S. stock indexes posted modest gains on Monday, helped by financial and industrial shares, while investors braced for a heavy week of corporate results and comments from Federal Reserve officials that could give more insight into the path of interest rates.
Markets are gauging the health of corporate profits and the economy after several banks kicked off first-quarter reports with strong results last week.
Meanwhile, the New York Fed said on Monday its barometer of manufacturing activity in New York State increased for the first time in five months in April, helping solidify the case for the U.S. central bank to raise rates at its meeting next month.
"Markets are in a bit of a wait-and-see mode," said Angelo Kourkafas, an investment strategist at Edward Jones. "We have a lot of corporate earnings ahead of us and the Fed rate decision in a couple of weeks."
The Dow Jones Industrial Average rose 100.71 points, or 0.3%, to 33,987.18; the S&P 500 gained 13.68 points, or 0.33%, at 4,151.32; and the Nasdaq Composite added 34.26 points, or 0.28%, at 12,157.72.
Among S&P 500 sectors, financials rose 1.1%, industrials gained 0.8% while the lower-weighted real estate group increased 2.2%. Energy fell 1.3%.
Shares of Google parent Alphabet (NASDAQ:GOOGL) Inc dropped 2.7%, weighing on the S&P 500 and Nasdaq, after a report that South Korea's Samsung Electronics (OTC:SSNLF) was considering replacing Google with Microsoft-owned Bing as the default search engine on its devices.
Investors are awaiting more reports from major U.S. banks this week, including Goldman Sachs Group Inc (NYSE:GS), Bank of America Corp (NYSE:BAC) and Morgan Stanley (NYSE:MS), after heavyweights including JP Morgan Chase (NYSE:JPM) & Co reaped windfalls from higher interest payments last week.
Other companies due to report this week include Johnson & Johnson (NYSE:JNJ), Tesla (NASDAQ:TSLA) Inc and Netflix Inc (NASDAQ:NFLX).
S&P 500 company earnings are expected to have declined 4.8% in the first quarter from the year-earlier period, according to Refinitiv IBES data.
"Corporate profits are emerging as the big driver of what the market is likely to do in the near term and investors want to see what those look like here before they place bets," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana.
Investors are also seeking to gauge the outlooks from executives following a banking crisis last month that some expect could hasten an economic downturn.
U.S. Treasury yields rose on Monday, with a slew of Fed speakers due later in the week. The U.S. central bank is widely seen raising rates by 25 basis points to the 5%-5.25% range next month.
In company news, State Street Corp (NYSE:STT) shares fell 9.2% after the financial services provider's quarterly profit missed analysts' estimates, hurt by a fall in fee income.
Advancing issues outnumbered decliners on the NYSE by a 1.42-to-1 ratio; on Nasdaq, a 1.61-to-1 ratio favored advancers.
The S&P 500 posted 15 new 52-week highs and one new low; the Nasdaq Composite recorded 70 new highs and 158 new lows.
About 10 billion shares changed hands in U.S. exchanges, compared with the 10.8 billion daily average over the last 20 sessions.