U.S. stocks closed about 1 percent higher on Tuesday as investors found encouragement from some recovery in oil prices and Chinese stocks, amid mixed earnings and the beginning of the Federal Reserve's two-day meeting. ( Tweet This )
"Oil is definitely having a good impact. When you see the price of oil up, that's giving you indications that people are moving into areas that have been hard hit," said Robert Pavlik, chief market strategist at Boston Private Wealth.
However, he said the market could move lower again before ending the year higher. The trade volume is "not enough to convince me the tide has turned," Pavlik said.
The major averages broke a five-day losing streak. The Dow Jones industrial average closed about 190 points higher after briefly gaining more than 200 points, with Exxon Mobil, Chevron and Caterpillar among the greatest advancers.
The energy sector leaped about 3 percent as the greatest advancer in the S&P 500, which closed 1.2 percent higher. Oil recovered to trade near $48 a barrel.
It's a "commodity that has been unidirectionaly lower and you get a bounce," said Art Hogan, chief market strategist at Wunderlich Securities. He noted the recovery in energy stocks helped materials and industrials as the next-best performing sectors in the S&P 500.
Crude oil settled up 59 cents, or 1.24 percent, at $47.98 a barrel, after trading lower for the last four sessions.
Phil Flynn, energy market analyst at The Price Futures Group, noted some short covering ahead of crude inventory data and the conclusion of the Fed meeting Wednesday, amid some stabilization in China.
"China didn't crash," he said. "If China becomes stable the market will focus on their demand-supply which is strong (for oil)."