U.S. stocks rallied on Monday, as stronger-than-expected manufacturing data helped offset lingering uncertainties surrounding the next Federal Reserve Chair.
The S&P 500 closed up 0.5% in New York, halting a three-day losing streak, though it fell short of reaching a new record high.
The tech-heavy Nasdaq 100 Index advanced 0.7%.
"Strongest ISM manufacturing data in 41 months boosted confidence in the health of the U.S. domestic economy, lifting stocks, rates, and the dollar," said José Torres, Senior Economist at Interactive Brokers.
U.S. manufacturing activity unexpectedly expanded in January, recording its fastest pace of growth since 2022, primarily driven by robust increases in new orders and production.
Wall Street's reaction to Federal Reserve Chair candidate Kevin Warsh, which weighed on stocks and precious metals last Friday, continued to exert influence on Monday.
Tom Essaye of The Sevens Report noted that the market was "slightly disappointed" by the nomination, citing Warsh's past comments viewed as less supportive of quantitative easing and his calls for "institutional change" at the Fed.
On the individual stock front, the ISM data boosted industrial shares, with Caterpillar among those outperforming the broader market.
Walt Disney saw its shares drop 7.4% after providing an earnings outlook that analysts viewed as mixed.
At the close, the S&P 500 was up 0.5% at 6,976.44.
The Dow Jones Industrial Average climbed 1.1% to 49,407.66.
The Nasdaq Composite Index gained 0.6% to 23,592.11.
The Nasdaq 100 Index rose 0.7% to 25,738.61.
The Russell 2000 Index increased 1% to 2,640.284.
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