U.S. stocks traded sharply higher on Tuesday on continued momentum from strengthening oil prices and encouraging developments in the Eurozone.
"We've got a continuation of strength. Looks like the two major drivers of yesterday's strength are still with us today," said Art Hogan, chief market strategist at Wunderlich Securities.
The Dow Jones Industrial Average briefly gained more than 200 points, or more than 1 percent, with Caterpillar in the lead, followed by Exxon Mobil and Chevron, each rising more than 2 percent each.
Factory orders for December posted a greater-than-expected decline of 3.4 percent.
Reporting before the bell, UPS matched estimates with adjusted quarterly profit of $1.25 per share, while revenues were above forecasts. However, the company said its results were below its own expectations, and it also forecast full-year results below Street forecasts. It plans to address these issues with cost and revenue actions, although UPS adds that customers were "delighted" with its service during the holiday season.
BP posted better-than-expected replacement cost profit of $2.2 billion for the fourth quarter, despite taking a $3.6 billion impairment cost. In a television interview, CEO Bob Dudley warned that oil prices could remain as low as $50 per barrel "for some time."
The S&P 500 traded up 16 points, or 0.82 percent, at 2,037.45 points in the open, with energy leading gains across all sectors except for utilities.
The Nasdaq gained 26 points, or 0.56 percent, to 4,701.83 in the open.
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