By Sruthi Shankar
U.S. stocks rose on Monday, with banks and industrial stocks driving a third day of gains on Wall Street as investors looked ahead to a strong quarterly earnings season, setting aside trade concerns.
Bank stocks were the biggest gainers, with the S&P banks index rising 2.4 percent, on track for its biggest percentage gain in over three months, helped by a rise in U.S. yields.
JPMorgan, Wells Fargo and Citigroup are scheduled to report on Friday, kicking off the second quarter earnings season in earnest.
"The market is anticipating a very good earnings season and ignoring any trade issues," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
"We're not likely to get much color on trade from this earnings, so the expectation is still for a very good season."
The United States and China slapped tit-for-tat tariffs on $34 billion of each other's goods on Friday, escalating a months-long trade dispute between the two countries.
But strong U.S. jobs data and hope that the tariff enactment would not end in an all-out trade war helped U.S. stocks close higher on Friday.
Estimates for S&P 500 second-quarter profit growth have risen slightly since April, putting the latest forecast at around 20.7 percent, based on Thomson Reuters data.
A BofA Merrill Lynch Global Research report showed earnings per share for S&P 500 companies for 2018 was revised higher to $159 from $153, amid better-than-expected first-quarter results, higher oil prices and stronger-than-expected U.S. economic growth.
At 12:47 p.m. ET the Dow Jones Industrial Average was up 309.30 points, or 1.26 percent, at 24,765.78, the S&P 500 was up 21.45 points, or 0.78 percent, at 2,781.27 and the Nasdaq Composite was up 37.22 points, or 0.48 percent, at 7,725.60.
Seven of the 11 major S&P sectors rose, led by a 2 percent jump in the financial index.
Caterpillar rose 3.8 percent, providing the biggest boost to the Dow. The S&P industrial sector jumped 1.8 percent, with defense stocks Boeing, Lockheed Martin and Northrop Grumman gaining.
Twitter sank 8.6 percent after the Washington Post reported that the social media company suspended more than 70 million fake accounts in May and June, which analysts said could be negative for user growth.
Advancing issues outnumbered decliners for a 1.92-to-1 ratio on the NYSE and for a 1.53-to-1 ratio on the Nasdaq.
The S&P index recorded 19 new 52-week highs and no new lows, while the Nasdaq recorded 127 new highs and 25 new lows.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)