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Stock Market Today: Dow Surges Above 17,000 as Citigroup Tops Street

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NEW YORK ( TheStreet) -- Markets were boasting healthy gains Monday with the Dow Jones Industrial Average  closing well above the psychological threshold of 17,000, a level it had dipped below after European markets sold off last week .

Driving factors behind Monday momentum were twofold: Citigroup , the second bank to report, recorded second-quarter earnings well over expectations and several pharmaceutical companies spoke of M&A activity.

The Dow hit an intraday record high of 17,088.43 before settling 0.66% higher to 17,056. The S&P 500  climbed 0.48% to 1,977.1, while the Nasdaq gained 0.56% to 4,440.42 This marks the second consecutive session of advances for benchmark indices, though Friday's gains were minor .

Citigroup beat second-quarter earnings estimates, helping to push shares up 3% to $48.42. The bank reported adjusted earnings of $1.24 a share vs. the consensus estimate of $1.05. Citigroup also announced a $7 billion settlement with U.S. authorities over the investigation of its sales of mortgage-backed bonds.

Citigroup's peers rallied in response to the upbeat report. Bank of America   added 1.2%,  JPMorgan  moved 0.88% higher and Goldman Sachs   jumped 1.3%. JPMorgan and Goldman are due to report before the bell Tuesday, while Bank of America will report Wednesday.

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Mylan popped 2.1% to $51.24 after the company said it would buy Abbott's non-U.S. developed markets specialty and branded generics business for $5.3 billion in stock.

Shire , the Dublin-based drugmaker, said Monday it would be willing to recommend to its shareholders a new $53 billion takeover bid from AbbVie . Shire was up 2.1% to $254.27 and AbbVie shares slipped 0.2% to $54.85.

M&A activity was also seen in the energy sector after Whiting Petroleum announced it was buying Kodiak Oil & Gas for $3.8 billion in stock and the assumption of $2.2 billion in debt. The deal will make it the largest producer in the booming Bakken region of North Dakota and Montana. Whiting shares were advancing 7.7% to $84.58 and Kodiak was tacking on 4.8% to $14.91.

Markets in Europe and Asia were also back in positive territory on Monday. "Reassured that systemic risks from Portugal are very limited, even in a worst case scenario, the dust settled somewhat Friday after Thursday's market tremors," wrote Michala Marcussen, global head of economics at Societe Generale .

As the economy continues to improve and labor market trends point higher, Gina Martin Adams, Wells Fargo Securities' institutional equity strategist, is expecting the S&P 500 to post 6.5% year-over-year EPS growth for the second quarter, up from the 3.3% reported in the first quarter and 3.9% a year ago. Fifty-nine S&P 500 companies are scheduled to report this week.