After United Airlines and Continental Airlines announced an all-stock merger agreement, U. S. markets closed higher on Monday.

Shares of United Airlines shot up 2.13 percent in early trading. Continental shares rose 1.92 percent.

It was reported that the Institute of Supply Management also gave investors confidence, as the trade group's headline manufacturing index rose for the ninth month in April.

The Dow Jones industrial average, by close, added 143.22 or 1.3 percent to 11,151.83. The Standard & Poor's 500 rose 15.57 or 1.31 percent to 1,202.26.

It was also reported that the Nasdaq composite index of tech-dominated stock rose 37.55 or 1.53 percent to 2,498.74.

2,360 stocks advanced and 696 declined on a volume of 4.8 billion shares traded on the New York Stock Exchange.

The benchmark 10-year Treasury note fell 9/32 to yield 3.692 percent.

From Friday's $1.3314, the euro fell to $1.3189. The dollar, against the yen, rose to 94.53 yen from Friday's 93.93 yen. (With Inputs from Agencies)