Stocks rose on Monday, led by gains in Facebook, as investors continued to bet on technology stocks as they pored through more corporate earnings results.
The Nasdaq Composite advanced 0.6 percent to 7,859.68 as Facebook shares gained 4.5 percent, their biggest one-day rise since April. The tech-heavy index also posted a five-day winning streak, its longest since May. The Dow Jones Industrial Average climbed 39.60 points to close at 25,502.18, led by gains in Disney. The S&P 500 rose 0.4 percent to 2,850.40, as tech and consumer discretionary outperformed.
Facebook rose on reports that the social media giant is in talks with banks to incorporate users' financial information into Messenger.
Berkshire Hathaway posted stronger-than-forecast quarterly profit on Friday, sending its Class B shares up by 3 percent. Cardinal Health and Tyson Foods reported better-than-expected corporate earnings before the bell. Shares of Tyson Foods rose more than 3 percent, but Cardinal Health's stock slipped 0.5 percent. Jacobs Engineering shares spiked 7.8 percent higher on better-than-forecast earnings and were the best performers in the S&P 500.
"The positive surprises in the earnings season are strong and that's helping the overall sentiment in the market," said Quincy Krosby, chief market strategist at Prudential Financial. The biggest takeaway from this earnings season is that "tax cuts were clearly a positive for the bottom line but ... the top line has also been good."
This earnings season has been stronger than analysts had expected. Of the S&P 500 companies that had reported through Friday, 80 percent have posted better-than-expected profits, according to FactSet. If that number stays there or moves above 80 percent, it would be the highest percentage of companies to beat expectations since FactSet started tracking the data in 2008.
Investors came into this earnings season with high hopes as FactSet had forecast year-over-year profits to grow by 20 percent in the second quarter. So far, second-quarter earnings have grown by 24 percent through Friday.