US stocks rise to close volatile January as Nasdaq rallies over 3% ahead of mega-cap tech earnings

• US stocks closed higher on the last trading day of January, wrapping up one of the worst months since the pandemic began.
• The whiplash in equities began with jitters that the Fed will make an aggressive pivot to fight inflation
• Mega-cap tech firms including Alphabet, Facebook, and Amazon are all set to report this week.

US stocks closed the last trading day of January in the green as investors braced for more fourth-quarter earnings results amid a more hawkish Federal Reserve.

January marked one of the worst months for equities since the pandemic began as investors grappled with a more aggressive central bank determined to tighten monetary policy in order to tamp down surging inflation.

The benchmark S&P 500 and the Dow Jones Industrial Average closed higher on Monday. Meanwhile, the tech-heavy Nasdaq Composite spiked over 3%.

Here's where US indexes stood shortly after 4:00 p.m. ET close on Monday:

• S&P 500: 4,515.53, up 1.89%
• Dow Jones Industrial Average: 35,131.86, up 1.17% (406.39 points)
• Nasdaq Composite: 14,239.88, up 3.41%

The whiplash in US equities began with jitters that a Fed determined to curb inflation will turn aggressively hawkish. That included worries the central bank may hike rates and start to shrink its nearly $9 trillion balance sheet faster than expected this year.

"It seems the Fed will struggle to reach a clear consensus over how aggressive the March liftoff will be, so aggressive 'buying the dip' won't be happening anytime soon," Edward Moya, senior equity analyst at Oanda, said in a Monday note. "Economic conditions are still looking good this year but repositioning overvaluations and growth concerns will likely keep volatility elevated over the short-term."

Meanwhile, earnings season continues with mega-cap tech firms Alphabet, Meta Platforms' Facebook, and Amazon set to report this week.

"A reminder of the real strength in well-established companies should give strength and confidence to investors to stay the course and look for bargains," Louis Navellier, chair and founder of fund manager Navellier & Associates, said in a Monday note.

Sony jumped nearly 6% in Monday's session after the company announced it is acquiring Bungie — the developer behind Destiny and Halo franchises — for $3.6 billion as video game mergers and acquisitions heat up.

Spotify surged 11% as the audio streaming company said it will add an advisory to content containing discussions about COVID-19, a response to criticism that "The Joe Rogan Experience" program was spreading misinformation about the virus.

Robinhood popped 11% as Cathie Wood's Ark Invest revealed it bought the dip following lackluster earnings from the popular trading app last week.

The 10-year Treasury yield fell to 1.782% from Friday's 1.779%. Bond yields move inversely to prices.

Oil prices hovered near seven-year highs as tensions over Russia and Ukraine are still drawing the market's attention ahead of this week's OPEC+ meeting to discuss a March production increase.

West Texas Intermediate crude oil rose as much as 1.70% to $88.30 per barrel. Brent crude, oil's international benchmark, jumped as much as 1.31% to $91.21 per barrel, and is headed for its best January in at least 30 years.

Gold rose 0.48% to $1,798.02 per ounce.