U.S. stocks rose on Monday, lifting the S&P 500 and the Dow to record finishes, as technology shares surged and M&A activity helped brighten Wall Street's view of the economy.
Internet and biotechnology shares battered last week bounced back on Monday, with Twitter, Yahoo and Facebook among those rallying. TripAdvisor, Netflix and Biogen Idec were among the top gainers on the.
Hillshire Brands said it would pay about $6.6 billion to purchase Pinnacle Foods, while the board of Allergan turned back an unsolicited offer from Valeant Pharmaceuticals International as significantly undervaluing the drug developer. And, Pfizer pushed its proposal to buy AstraZeneca for $106 billion, with Pfizer's head of research saying the acquisition would not hinder drug research.
With 90 percent of first-quarter results reported by S&P 500 companies, 69.2 percent have beaten earnings estimates, and 52.9 percent have reported revenue above analyst expectations, according to Thomson Reuters
"The earnings season has come along pretty good, and importantly, I think the guidance for the second quarter and the rest of the year has been constructive. So, with the weather out of the way, maybe there is a more positive read through on economic growth and corporate earnings, now that we have this winter issue behind us," said Phil Orlando, equity market strategist at Federated Investors.
"Our estimate is 3.6 percent for second-quarter GDP, but in the last week or so, I've started to see some 4 and 5 handles on it, so the street is expecting a pretty strong bounce. The question the street is grappling with is, is that second-quarter bounce sustainable through the end of the year? We believe the rebound we see in the second quarter is going to be sustainable into the second half, and that we'll have 3 handles through the end of the year," Orlando added.
Major U.S. Indexes
The Dow Jones Industrial Average rose to an intraday record of 16,704.84, and ended up 12.13 points, or 0.7 percent, to 16,695.47, a record finish.
The advanced 18.17 points, or 1 percent, to 1,896.65, above its April 2 record close and less a point from its intraday record, with industrials and technology leading gains and utilities and telecommunications the poorest performers among its 10 major industry groups.
The Nasdaq climbed 71.99 points, or 1.8 percent, to 4,143.86.
The CBOE Volatility Index, a measure of investor uncertainty, fell 5.8 percent to 12.17.
For every share falling, four rose on the New York Stock Exchange, where 640 million shares traded. Composite volume approached 3 billion.
On the New York Mercantile Exchange, gold prices jumped $8.20, or 0.6 percent, to $1,295.80 an ounce, and oil futures for June delivery climbed 60 cents, or 0.6 percent, to $100.59 a barrel.
The U.S. dollar fell against the currencies of major U.S. trading partners, while the 10-year Treasury yield used in figuring mortgage rates and other consumer loans added 3 basis points to 2.653 percent.
China's government said in a Friday statement it would ease foreign-investment caps in listed companies and hike quotas for capital flows.
And, developments in Ukraine had pro-Russian rebels voting to secede in some eastern parts of the nation. The referendum has been dismissed as illegal by Kiev and Western governments.
Read MoreEast Ukraine vote spells trouble for markets
On Friday, the Dow closed at a record while the Nasdaq Composite tallied its largest weekly drop in a month. The Russell 2000 fell nearly 10 percent from its record closing high during the session.
"Will the market correct? Absolutely. Does it have to correct because the Russell 2000 and the Nasdaq corrected? Absolutely not," said Art Hogan, chief market strategist at Wunderlich Securities.
"Only 33 percent of the time does a pullback in the Russell dictate a pullback in the S&P 500," Hogan added.
—By CNBC's Kate Gibson
Coming Up This Week:
Tuesday
Earnings: Surgical Care Affiliates, Abercrombie and Fitch, Take Two Interactive, EnCana, Fossil, URS
7:30 a.m.: NFIB survey
8:30 a.m.: Retail sales
8:30 a.m.: Import prices
10:00 a.m.: Business inventories
10:30 a.m.: Richmond Fed President Jeffrey Lacker
Wednesday
Earnings: Macy's, Sony, Sodastream, Cisco Systems, Agilent, Vimpelcom, Deere, Jack in the Box, SeaWorld, Eagle Materials, NQ Mobile
8:30 a.m.: PPI
Thursday
Earnings: Wal-Mart, Nordstrom, JC Penney, Kohl's, Vivendi, CA,Applied Materials, Flowers Foods, Advance Auto Parts
8:30 a.m.: Weekly jobless claims
8:30 a.m.: CPI
8:30 a.m.: Empire State survey
9:00 a.m.: TIC data
9:14 a.m.: Industrial production
10:00 a.m.: Philadelphia Fed survey
10:00 a.m.: NAHB survey
6:10 p.m.: Fed Chair Janet Yellen at US Chamber of Commerce on small business
Friday
8:30 a.m.: Housing starts
9:55 a.m.: Consumer sentiment
11:50 a.m.: St. Louis Fed President James Bullard
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