NEW YORK — Stocks posted solid gains Tuesday, led by energy companies after news reports said Saudi Arabia and Russia were working toward an agreement to cut oil production. Investors also worked through the initial batch of earning reports from the first quarter of the year.
The Dow Jones industrial average rose 164.84 points, or 0.9 percent, to 17,721.25. The Standard & Poor’s 500 index climbed 19.73 points, or 1 percent, to 2,061.72, and the Nasdaq composite increased 38.69 points, or 0.8 percent, to 4,872.09.
Alcoa, the aluminum mining giant, reported a 15 percent decline in revenue late Monday, and a huge drop in first-quarter profit from 2015 as aluminum prices fell. Alcoa’s stock fell 26 cents, or 2.7 percent, to $9.48.
Big U.S. banks, including JPMorgan Chase, Citigroup and Wells Fargo, start releasing their results this week. Investors will be watching to see how well they’ve weathered the market’s recent volatility and low oil prices. Banks are often seen as a proxy for how the U.S. economy is doing.
“It’s not going to be a clean earnings season for financials at all,” said Peter Stournaras, a BlackRock portfolio manager. “The banks have suffered from fears about oil loans, but those fears are overblown.”
Expectations for earnings are low this quarter. Analysts surveyed by FactSet expect corporate profits to be down 9.1 percent from a year ago, hurt primarily by the steep drop in oil prices and other commodities. The entire energy sector is expected to report a loss this quarter, according to FactSet.
“Earnings will paint an important picture over the next few weeks, but the more important story is the continued improvement in the macroeconomic environment here in the U.S. and globally,” said Ryan Larson, head of U.S. equity trading at RBC Global Asset Management in Chicago.
Oil prices moved sharply higher after Russian officials told Interfax, the Russian news agency, that they planned to reach a deal with Saudi Arabia to cut oil production. OPEC ministers meet this Sunday in Doha, Qatar.
Benchmark U.S. crude oil climbed $1.81, or 4.5 percent, at $42.17 a barrel in New York. Brent crude, the international standard, rose $1.86 to $44.69 a barrel in London.
Energy stocks, which have been beaten down in recent months, followed the price of crude oil higher. The energy component of the S&P 500 jumped almost 3 percent.
U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 1.77 percent from 1.73 percent late Monday. The euro fell to $1.1397 from $1.1412 while the dollar rose to 108.53 yen from 107.94 yen.
Precious and industrial metals prices closed broadly higher.
