Stocks reversed their early losses to end near session highs in thin trading Monday, but investors hesitated to jump in ahead of what is expected to be a lackluster first-quarter earnings season.
(Read More: After-Hours Buzz: JCP, AA & More)
The Dow Jones Industrial Average rose 48.23 points, or 0.33 percent, to close at 14,613.48, led by Coca-Cola and Bank of America. Johnson & Johnson led the blue-chip laggards.
The S&P 500 climbed 9.79 points, or 0.63 percent, to finish at 1,563.07. The Nasdaq gained 18.39 points, or 0.57 percent, to end at 3,222.25. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded below 14.
Most key S&P sectors finished in positive territory. Consumer staples and consumer discretionary climbed, while telecoms lagged.
Aluminum producer and Dow component Alcoa is slated to post results after the closing bell, marking the unofficial start to first-quarter earnings season. Analysts polled by Thomson Reuters expect the company to post earnings of 8 cents a share on revenue of $5.88 billion. Alcoa shares ticked slightly higher.
(Read More: After 'March Madness,' Earnings Season Could Bring 'April Anxiety')
Banking giants JPMorgan and Wells Fargo are scheduled to post earnings on Friday.
The earnings outlook for the current quarter is fairly weak, with growth expected to increase by just 1.6 percent, compared to 6.2 percent last quarter and down from a 4.3 percent forecast in January, according to Thomson Reuters. The quarter also has seen an unusually high number of negative warnings, with 107 negative revisions for companies in the S&P 500. Compared to positive revisions, it is the worst pace in 12 years, the news agency added.
(Read More: Now It's Earnings That Could Stall the Stock-Market Rally)
"Sometimes, earnings are a secondary trigger for markets – it's been more news-based as we've seen recent market rallies have to do with economic indicators," said Christine Short, senior manager at S&P Capital IQ.
While S&P Capital IQ expects first-quarter 2013 earnings growth of 0.7 percent, Short noted that the final number usually ends up about 4 percent higher than initial estimates.
"So we could see this could be an earnings season of about 5 percent growth, which would be respectable," she said. "And if we do end up 4 percent higher, it should help give the markets a boost."
Stocks finished in negative territory last week, pressured by fears over North Korea and a handful of weaker-than-expected economic data including a disappointing nonfarm payrolls report, adding to jitters that the rate of economic growth could be weakening.
"Despite all of this, the market has been amazingly resilient in 2013 so it makes good sense to continue to leave the upside open just in case all of this data is wrong," wrote Randy Frederick, managing director of active trading and derivatives at Charles Schwab. "Any pullbacks should be considered to be long-term buying opportunities, but if your trading style is shorter term in nature, late second-quarter might be a better entry point than early second-quarter."
In corporate news, General Electric agreed to buy oilfield services giant Lufkin Industries for $3.38 billion in cash, or $88.50 a share. Lufkin surged nearly 40 percent following the news.
Macy's and rival J.C. Penney are due back in court in their battle over Martha Stewart home goods after a month-long mediation effort appeared to have failed.
Johnson & Johnson slid to lead the Dow laggards after JPMorgan downgraded the drugmaker to "neutral" from "overweight." However, the firm increased its price target to $83 from $77.
Avon Products ticked higher after the direct seller of cosmetic products said it will cut more than 400 jobs as part of a turnaround plan.
Traders will also be looking out for more clues over the future of quantitative easing in the coming week when the Federal Reserve releases minutes from its last meeting on Wednesday. There are also more than a half dozen appearances by Fed officials in the coming week, including Fed Chairman Ben Bernanke.
(Read More: Pimco's Bill Gross: Beware of 'Monetary Red Bull')
European shares ended higher, mostly shrugging off negative news flow and Friday's weak employment numbers in the U.S. Meanwhile, U.S.Treasury Secretary Jack Lew will be in Europe for economic discussions with the region's officials and leaders. Lew is scheduled to meet with members of the European Commission in Brussels on Monday and will also travel to Frankfurt where he will meet with European Central Bank President Mario Draghi.
—By CNBC's JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)
Coming Up This Week:
TUESDAY: NFIB small business optimism index, Fed's Lacker speaks, wholesale inventories, 3-yr note aution, Fed's Lockhart speaks, Bank of New York Mellon shareholders mtg
WEDNESDAY: Mortgage applications, Fed's Lockhart speaks, Fed's Kocherlakota speaks, oil inventories, IMF's Lagarde speaks in NYC, 10-yr note auction, FOMC minutes, Treasury budget, Obama budget blueprint released; Earnings from CarMax, Constellation Brands, Chevron (interim report), Bed Bath & Beyond
THURSDAY: Fed's Plosser speaks, Fed's Bullard speaks, Jobless claims, import/export prices, natural gas inventories, 30-yr bond auction, Fed balance sheet, money supply, Deutsche Bank annual mtg; Earnings from Pier 1 Imports, Rite Aid, JB Hunt
FRIDAY: PPI, retail sales, consumer sentiment, business inventories, Bernanke speaks at Fed's development conf.; Earnings from JPMorgan, Wells Fargo
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