In a week that could see more volatility in financial markets, Wall Street began to claw back some of its recent losses on Monday. The S&P 500 rose 1.2% in its first trading session after dropping over 10% below its high point for the year. The Dow Jones Industrial Average increased by 509 points, or 1.6%, and the Nasdaq composite was up 1.2%. Western Digital played a role in supporting the market, with its stock jumping 6.7% after reporting better-than-expected results for the latest quarter and announcing plans to split its company into two. McDonald's also reported stronger profit and revenue for the summer, causing its stock to rise 2.4%. According to FactSet, over 75% of companies in the S&P 500 have reported stronger profits for the latest quarter than expected, suggesting that S&P 500 companies are on track to deliver profit growth for the first time in a year.

The positive earnings reports have helped ease concerns on Wall Street, where two main factors have been causing anxiety. Firstly, the mixed reaction to profit reports from influential Big Tech companies has had a significant impact on the market. This reporting season, sharp drops for Alphabet and other Big Tech members have shaken investor confidence. Apple, the most valuable stock on Wall Street, is set to report its latest quarterly results on Thursday, which could further affect the market. Secondly, the sharp rise in Treasury yields has been weighing on stocks. Higher bond yields make stocks and other investments less attractive to investors, and they can also increase borrowing costs for businesses and consumers. The yield on the 10-year Treasury, which reached its highest level since 2007 earlier this month, rose to 4.89% from 4.84% on Monday.

The Federal Reserve's upcoming interest rate decision is another source of concern for investors. The central bank has already raised rates to their highest level since 2001 in order to curb inflation. The Fed's next meeting will begin on Tuesday, with an announcement expected on Wednesday. While the market predicts that rates will remain steady, investors will be closely watching for any hints regarding the Fed's future plans. The central bank has previously indicated that it may keep rates high for a prolonged period to combat inflation, and it has also suggested that rising longer-term Treasury yields could act as rate hikes on their own. Several economic data points this week, including employment costs, job openings, and the jobs report for October, will be closely watched by investors.

In addition to earnings reports and economic data, oil prices have been volatile due to the ongoing Israel-Hamas conflict. Traders are uncertain about the potential impact of the conflict on oil production in the region. U.S. crude fell 3.5% to $82.54 per barrel on Monday, while Brent crude, the international standard, dropped 3% to $86.56 per barrel.

Internationally, European indexes rose following a more mixed finish in Asia. Japan's Nikkei 225 was down 1% on Monday. Overall, the stock market remains uncertain as investors navigate through a week filled with important economic data and earnings reports.