(Bloomberg) -- U.S. stocks rose, with the Standard & Poor’s 500 Index extending gains in the final 30 minutes of trading, as energy shares rallied after the price of crude oil advanced to a one-month high.
The S&P 500 rose 1.3 percent to 2,020.86 at 4 p.m. in New York, climbing above its average price for the past 100 days. The guage earlier fell to its lowest level since Dec. 17, before rallying. The Dow Jones Industrial Average added 195.45 points, or 1.1 percent, to 17,360.40.
Energy shares in the S&P 500 led gains, surging 3 percent for the biggest advance in two weeks. Exxon Mobil Corp. and Chevron Corp. jumped at least 2.5 percent. Phone shares added 2.6 percent as a group, with Verizon Communications Inc. climbing 2.8 percent, the most since Feb. 20, 2014.
The S&P 500 fell 2.8 percent last week, extending the worst monthly loss in a year, as weaker-than-forecast economic growth outweighed a rally in energy shares and the highest consumer confidence reading in 11 years, amid continuing concern in Europe over the new Greek government’s challenge to an austerity program. The index lost 3.1 percent for the month, the worst performance since January 2014.
Factories expanded in January at the weakest pace in a year as orders cooled, a sign weakness in overseas markets is restraining U.S. manufacturing. The Institute for Supply Management’s index dropped to 53.5 from 55.1 in December, the report from the Tempe, Arizona-based group showed Monday. The median forecast in a Bloomberg survey of 74 economists called for a decline to 54.5. Readings greater than 50 signal growth.

Slower Growth

The plunge in oil prices is limiting sales at manufacturers such as Caterpillar Inc. while slower growth from Europe to China and the strengthening dollar represent another hurdle for American exports.
A separate report showed consumer spending fell in December as households took a breather from the break-neck pace of buying that characterized the fourth quarter.
Data last week showed the U.S. economy expanded at a slower pace than forecast in the fourth quarter as cooling business investment, a slump in government outlays and a widening trade gap took some of the luster off the biggest gain in consumer spending in almost nine years.
The Federal Reserve upgraded its assessment of the U.S. economy in a Jan. 28 statement, and noted labor market conditions have improved further, “with strong job gains and a lower unemployment rate.”

Earnings Season

That view suggests the Fed remains on track for a mid-year interest rate hike, and Friday’s January nonfarm payrolls report may further solidify that view. Economists forecast 232,000 jobs were added last month, compared with 252,000 in December.
Nine S&P 500 members report financial results on Monday. About 78 percent of the companies that posted earnings this season have beaten analyst estimates, while 55 percent have topped sales projections, data compiled by Bloomberg show.
“The bottom line is it all comes down to company earnings and growth is on the positive side,” Karyn Cavanaugh, the New York-based senior market strategist at Voya Investment Management LLC, said by phone. Voya oversees $215 billion. “There are a lot of worries out there and the market gets a bit wobbly, but earnings guide the way.”
To contact the reporter on this story: Oliver Renick in New York at orenick2@bloomberg.net
To contact the editors responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net; Jeff Sutherland at jsutherlan13@bloomberg.net Jeremy Herron, Jeff Sutherland