U.S. equities closed higher on Monday, unfazed by a key vote in Italy which led to Prime Minister Matteo Renzi's resignation, as financials, technology and consumer discretionary stocks rose around 1 percent.
The Dow Jones industrial average gained around 45 points, notching record highs on an intraday and closing basis, with Goldman Sachs contributing the most gains. The S&P 500 advanced 0.58 percent, with financials, information technology and consumer discretionary leading advancers. The Nasdaq composite outperformed, closing 1 percent higher.
Stocks have been on a rip-roaring rally since the U.S. election, with the three large-cap indexes rising more than 2 percent. "I think we'll be OK through the rest of the year," said Tom Siomades, head of Hartford Funds Investment Consulting Group. "There really isn't that much to wrap your hands around through the rest of the year."
Renzi said he would step down after being defeated in a referendum regarding his plan to overhaul the Italian constitution. Renzi said voters had shown a "clear" rejection of legislative reform measures and that he would meet with his cabinet on Monday and then hand in his resignation to the President Sergio Mattarella, taking full responsibility for the defeat.
The reforms would have made it so that the executive branch needs approval only from parliament's lower house in order to pass laws. Legislation is a slow, arduous process in Italy, where there are a high number of lawmakers relative to the population, and where the two houses of parliament essentially have the same, duplicate powers.
But "going into the vote, ... the market had expected any trouble in terms of liquidity, particularly with the banks, would be mitigated by a Mario Draghi put," said Quincy Krosby, market strategist at Prudential Financial. Shares of Italian bank Banca Popolare di Milano fell more than 7 percent in European trade.
"I think the fact that we went through the referendum and not much has changed since then is [good] for U.S. markets," said Kate Warne, investment strategist at Edward Jones, adding that U.S. stocks were taking their cue from European markets.
The euro briefly dipped more than 1 percent against the dollar on Sunday evening, before trading higher against the U.S. currency. As of 4:01 p.m. ET, the European common currency traded 0.94 percent higher, at $1.0765. European stocks also rose, with the pan-European Stoxx 600 index rising about 0.56 percent.