Stocks closed up modestly, easing off the highs of the day, as upbeat earnings reports and rising commodity prices gave a lift to the market.
The Dow Jones Industrial Average advanced 34.43 points, or 0.3 percent, to close at 11,671.88, after gaining about 66 points earlier. The Dow ended down the three previous sessions.
Bank of America , Intel and Chevron led blue-chips higher, whileVerizon and AT&T lagged.
The S&P 500 gained 4.73 points, or 0.4 percent, to close at 1,274.48. The Nasdaq rose 9.03 points, or 0.3 percent, to close at 2,716.83. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 17.
Most key S&P sectors advanced, led by energy, materials and health care.Telecom fell.
The dollar traded flat against a basket of currenciesas did the euro. Worries about euro zone debt still lingered among some investors who turned to gold, pushing the price of the precious metal up for a second day to $1,384 an ounce.
There are "lots of eyes on commodities and commodity-driven stocks," Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.
Specialty chemical makers attracted particular notice, Kruszenski said, citing Ferro, which was up about 7 percent, as well as PolyOne and A. Shulman.
Bank shares mostly rose across the board after Societe Generale upgraded European banks to overweight, saying it believes the sector can achieve more profitability than the market expects. Also, Barclays rallied more than 4 percent after the brokerage noted the bank as one of its top picks.
HSBC climbed after Citigroup upgraded the investment bank to "hold" from "buy."
Other financials including Citigroup and Bank of America gained in addition to a handful of regional banks.
Also, MBIA soared after news the bond insurer won a dismissal of a court complaint challenging MBIA's 2009 restructuring.
Verizon announced a long-awaited partnershipwith Apple to sell the iPhone starting in February. Meanwhile, Jefferies raised its price target on Apple to $450 from $365.
AT&T shares fell as the arrangement was expected to pull customers from the telecom giant to Verizon, according to analysts.
AMD slumped after news that the chipmaker's CEO, Dirk Meyer, resigned in a "mutual agreement"with the board of directors. Current CFO Thomas Seifert will take over Meyer's position as the company conducts a search for a new CEO. Wells Fargo and Raymond James cut their ratings on AMD to "underperform," while S&P Equity raised its price target to $9 a share from $8.
Intel gained after the tech giant said it is paying graphics chip designer Nvidia a $1.5 billion licensing fee, settling a legal dispute over a license to make chipsets. In addition, at least five brokerages upgraded Nvidia's price target.
The price of oil rose 2.08 percent to $91.11 a barrel as a production platform in the Gulf of Mexico was shut down, and officials said there was no word yet on when a Trans Alaska Pipeline System pipeline would be restarted. Last weekend a leak was discovered in the pipeline, which supplies more than half a million barrels per day to the U.S.
Energy stocks were largely higher, including Consol Energy , which reported coal production rose 8.4 percent in the fourth quarter. The energy firm also said its output for natural gas reached a new record for the year.
Alcoa beat analysts' profit expectations in results posted after the market closed Monday, though the stock dropped as it has risen considerably in recent months. Analysts have mixed views. At least two brokerages raised their price targets on the firm and S&P Equity raised its rating on the company to "buy" from "hold." Meanwhile, RBC cut its rating to "underperform" from "sector perform."