Stocks climbed, led by tobacco companies after the Supreme Court declined to review a landmark tobacco-industry ruling.
The Dow Jones Industrial Average gained 34 points, or 0.3%, to 10177. The Nasdaq Composite rose 0.4% to 2232.
The Standard & Poor's 500-stock index rose 0.3% to 1080, with tobacco companies leading the consumer staples sector higher. Reynolds American gained 4%, Altria Group rose 3.8% and Lorillard gained 2.8% after the high court refused to revisit a case that found the tobacco industry violated federal racketeering laws by engaging in a decades-long scheme to deceive the public about the dangers of smoking.
The high court rejected appeals by both the tobacco industry, seeking to overturn lower-court holdings, and the government, attempting to revive its rejected attempt to get tobacco companies to forfeit up to $280 billion in profits and pay $10 billion for smoking-cessation programs.
In Europe, most equity markets posted slight gains, with the Stoxx Europe 600 index up 0.3% recently.
But the euro, recently trading around $1.2323, fell to a new low against the Swiss franc and weakened against the dollar. The dollar slipped against the yen. The U.S. Dollar Index, which tracks the U.S. currency against a basket of six others, rose 0.2%. Demand for Treasurys climbed, with the 10-year note up to push yield down to 3.05%. Gold futures advanced.
In other economic data, the Commerce Department said consumer spending, a key growth engine for the U.S. economy, was up 0.2% last month after a flat reading in April, in line with the expectations of economists surveyed by Dow Jones Newswires. Also matching expectations, incomes rose 0.4% in May, helped by slow improvements in the jobs market, following a 0.5% increase in April.
American depositary shares of oil giant BP rose 2.4%. BP said the costs of cleaning up the oil spill in the Gulf of Mexico have soared to $2.65 billion, an increase of $300 million from its estimate last Friday. The firm is currently drilling a relief well in an effort to stop the leak after numerous other strategies failed.
Among other stocks in focus, Universal Health Services slid 1.6% after Standard & Poor's Ratings Services cut the company to junk territory, saying its company's pending $2 billion acquisition of mental-health facility operator Psychiatric Solutions will have a dramatic impact on its financial risk profile.
Noble Corp. jumped 4.8% after agreeing to acquire privately held drilling company FDR Holdings for $2.16 billion as the energy company also announced the signing of new contracts with Royal Dutch Shell PLC.
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Asian shares shrugged off early losses and edged higher on Monday, while the Australian dollar was under pressure after no clear winner emerged from a weekend election.
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