Investors found optimism that Euro-zone leaders would take steps this week to contain the region’s debt crisis.
The S&P 500 gained 8.04 points to rise to 1,426.17. The Dow Jones Industrial Average reclaimed 50 points to rise to 13,322.
“The European situation, while certainly not resolved, has allowed the pressure to come off the dollar, which has helped commodity prices, the energy sector and the material sector, and added to the market’s upside pressure as well,” said Bruce Bittles, chief investment strategist at Milwaukee-based Robert W. Baird & Co. Inc.
Bittles noted that the U.S. dollar index today fell to its lowest mark since July, with the U.S. currency losing ground against currency rivals including the euro. A weaker U.S. dollar means the cost to buy U.S.-made goods overseas declines, boding well for U.S. exports.
“The strong dollar was really a negative for the markets, it’s not only deflationary, but hurts our exports, and when you translate export profits back into dollars, it hurts earnings,” Bittles said. “If the dollar starts to slide, earnings outlooks improve, so once again contrary opinion is playing a big role here.”