U.S. stocks rise on earnings; dollar declines

The S&P 500 rose 0.6% as earnings at Travelers Cos. and Johnson & Johnson beat expectations while higher commodity and freight costs weighed on shares of Procter & Gamble Co. Crypto stocks were also higher as Bitcoin climbed toward a record and the first futures exchange-traded fund launched.

A fifth day of gains brings the benchmark index about half a percent away from an all-time high as the market grapples with the prospect of tighter monetary policy amid rising prices. The dollar was weaker against major peers as traders raised bets central banks around the world would raise interest rates before the Federal Reserve. Meanwhile, global bond yields were mixed with the U.S. 10-year Treasury yield higher at 1.63%.

"Another week of upbeat results could be the boost that bulls are after to recapture those record levels," said Fiona Cincotta, senior financial markets analyst at City Index.

Investors are paying close attention to the earnings season to see how higher costs for energy and raw materials are affecting margins. Crude oil in New York climbed in a volatile session after Russia signaled it may not give Europe extra gas without approval for the Nord Stream 2 pipeline. Meanwhile, base metals took a breather on the race to record highs.

"This earnings season could be highly important for investors, as inflation, labor, supply, and currency risks settle in," said Lauren Goodwin, economist and portfolio strategist at New York Life Investments. "We will be particularly attuned to companies' guidance on the path ahead and whether higher costs could reduce corporate margins."

Speakers from the Federal Reserve this week are also expected to try to calm the market ahead of plans to begin tapering asset purchases.

"They're probably going to be very careful and cautious on rate hikes because of the fact that they just don't have enough information on the inflation front," said Subadra Rajappa, managing director and head of U.S. rates strategy at Societe Generale. "That's why I think you're seeing a little bit of an adjustment in the two year part of the curve this morning."

Some of the main moves in markets:

Stocks

The S&P 500 rose 0.7% as of 4 p.m. EDT

The Nasdaq 100 rose 0.7%

The Dow Jones industrial average rose 0.6%

The MSCI World index rose 0.7%

Currencies

The Bloomberg Dollar Spot Index fell 0.3%

The euro rose 0.2% to $1.1635

The British pound rose 0.5% to $1.3792

The Japanese yen was little changed at 114.34 per dollar

Bonds

The yield on 10-year Treasurys advanced four basis points to 1.64%

Germany's 10-year yield advanced four basis points to -0.11%

Britain's 10-year yield advanced three basis points to 1.17%

Commodities

West Texas Intermediate crude rose 0.5% to $82.84 a barrel

Gold futures rose 0.2% to $1,770.10 an ounce