U.S. stocks rose on Tuesday after encouraging earnings reports from economic bellwether United Parcel Service and industrial conglomerate Emerson Electric.
The S&P 500 is up for a second straight day after falling 6.2 percent in the last three weeks of January.
Exposure to emerging markets helped industrials Cummins Inc
Cummins stock jumped 7.1 percent to $50.25, and Emerson added 7.8 percent to $45.78. The S&P industrial sector <.GSPI> rose 1.3 percent.
This whole earnings season is all about, 'Is there top-line growth,' and some companies are showing it, said Frank Ingarra, portfolio manager at Hennessy Funds in Stamford, Connecticut.
This will help us going forward because if companies grow their top line, they will hire some more employees to drive sales and orders.
The Dow Jones industrial average <.DJI> gained 70.66 points, or 0.69 percent, to 10,256.19. The Standard & Poor's 500 Index <.SPX> added 7.80 points, or 0.72 percent, to 1,096.99. The Nasdaq Composite Index <.IXIC> was up 5.86 points, or 0.27 percent, to 2,177.06.
On the economic front, pending sales of previously owned U.S. homes edged up as expected in December, which could help calm fears of renewed weakness in the troubled sector.
Homebuilder D.R. Horton Inc
Investors will also watch White House adviser Paul Volcker's testimony before a Senate panel. He's expected to urge lawmakers to curb risks taken by large banks, according to testimony obtained by Reuters. His comments could move bank stocks, which tumbled when reports on the proposal broke last month.
JPMorgan Chase & Co
If (Volcker) backs off a little bit, or if people gain confidence (the proposal) is not going to be as pointed as it seemed when it was first announced, then maybe that will help the banks, said Peter Boockvar, equity strategist at Miller Tabak & Co in New York.
(Additional reporting by Edward Krudy; editing by Jeffrey Benkoe)