The Dow Jones Industrial Average rallied 550.99 points, or 1.86 percent, to 30,185.82. The S&P 500 was up 94.88 points, or 2.65 percent, to 3,677.95. The Nasdaq Composite Index increased 354.41 points, or 3.43 percent, to 10,675.80.
All the 11 primary S&P 500 sectors ended in green, with consumer discretionary and real estate up 4.23 percent and 3.89 percent, respectively, leading the advance.
Shares of Bank of America surged 6.06 percent after the company reported third-quarter earnings that beat market estimates.
The Bank of New York Mellon Corporation also delivered better-than-expected earnings, sending the stock up more than 5 percent.
High-profile tech companies including Netflix and Tesla are on deck to report later this week.
U.S. equities have been under considerable pressure this year amid growing fears that the Federal Reserve's aggressive policy tightening to tame inflation would tip the economy into a recession.
For the week ending Friday, the Dow rose 1.2 percent, while the S&P 500 and the Nasdaq fell 1.6 percent and 3.1 percent, respectively.
"Given the intensifying economic headwinds and the continued march higher in Fed rate hiking expectations, it appears likely that corporate profits will contract in the coming quarters," UBS analysts said Monday in a note.
"On the heels of our lower outlook for corporate profits, we reduce our June 2023 S&P 500 price target from 4,200 to 3,700 and introduce a year-end 2023 price target of 4,000," they said.
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