The S&P closed above 1,300 for the first time in 2-1/2 years on Tuesday and looked poised for more gains thanks to strong earnings and a surge in U.S. manufacturing.

The Dow Jones industrial average gained 148.23 points, or 1.25 percent, to 12,040.16. The Standard & Poor's 500 Index rose 21.39 points, or 1.66 percent, to 1,307.51. The Nasdaq Composite Index added 51.11 points, or 1.89 percent, to 2,751.19.