Stocks rebounded to close near session highs in a volatile session Monday, but gains were limited as investors continued to monitor headlines from the euro zone.
The Dow Jones Industrial Average jumped 85.15 points, or 0.71 percent, to close at 12,068.39, above the psychologically-important 12,000 mark.
Home Depot and Hewlett-Packard led the blue-chip gainers.
The S&P 500 gained 7.89 points, or 0.63 percent, to finish at 1261.12. The Nasdaq added 9.10 points, or 0.34 percent, to end at 2,695.25.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, finished below 30.
All 10 S&P sectors finished in the black, led by health care.
“You tell me where the euro is and I’ll tell you where stocks are trading,” said Alan Valdes, director of floor operations and VP of trading at DME Securities. “Volume’s also very light.”
Markets were volatile following reports that Italian Prime Minister Silvio Berlusconi was about to resign. Berlusconi denied the reports.
The Italian Prime Minister has one day to win over undecided members of parliament and stop a group of party rebels threatening to bring down his government in a backlash over its failure to adopt reforms to defuse a debt crisis.
Meanwhile, Greek Prime Minister George Papandreou sealed a deal with the opposition on a crisis coalition to approve an international bailout, but details remain thin despite an EU ultimatum for Athens to get serious about tackling its problems.
Meanwhile, Greece's new Prime Minister will be announced tomorrow.
Euro zone finance ministers meet in Brussels on Monday for a regular, scheduled meeting, but are likely to discuss the ongoing turmoil in the region.