US stocks have had a rough time in the market recently as questions revolving around economic conditions continue to surface. As a result, investors have been awaiting earnings reports for a gauge of how well the market is doing. On Monday, as major earnings reports started to surface and the news proved to be positive, the Dow Jones Industrial Average, NASDAQ, and S&P 500 are all surging. However, earnings reports aren't the only reason for the increase in stock values. Big news from China is also lending a hand to positive market movement.

Market Moving Earnings Reports

Not all earnings reports will have the power to move the market. However, there are several key stocks that investors watch as indicators for entire industries; and some of those companies have generated earnings reports.

• Hasbro – Leading toy maker Hasbro generated earnings of $0.21 per share in the first quarter; more than doubling analyst expectations of just $0.09 per share.
• Morgan Stanley – One of the world's leading investment banks, Morgan Stanley also smashed expectations with regard to earnings. Total net income came in at $2.31 billion in comparison to the expected $1.45 billion; equating to $1.18 per share. Analysts had only expected to see $0.78 EPS.
• Halliburton – Halliburton is one of the world's leading oil field service providers; and considering the decline in the value of oil we've seen, there weren't big expectations for earnings. However, it seems as though the low value of oil had less of an affect on the company than expected. In the first quarter, Halliburton produced $0.49 per share EPS in comparison to the $0.41 EPS analysts expected.

News From China Is Bigger Than Earnings

Perhaps more importantly for investors, China has started to make moves in an attempt to help the struggling economy. Unfortunately, China is currently seeing slower economic growth today than they've seen over the past 6 years; and the People's Bank of China has finally decided to jump into stimulus mode. In an attempt to free money for banks to lend, China's central bank has lowered the amount of cash that large banks must keep on reserve to 18.5% from 19.5%.

However, it's important to remember that the fact that stimulus was coming was already know. What has investors so excited is the size and timing of the stimulus. The way things are happening shows that Chinese leaders are more deeply concerned about the issue than was made apparent and will most likely generate strong growth more quickly than anticipated. Here's what IHS economist Brian Jackson had to say…

“While additional reserve requirement ratio cuts were expected throughout 2015, the size and timing of this cut indicates leaders are more deeply concerned about the state of the economy than official comments previously indicated,”

How The Market Reacted

As mentioned above, Monday was a great day in the market for all 3 blue chip indices in the United States. The Dow Jones Industrial Average climbed more than 200 points, the NASDAQ climbed more than 60, and the S&P 500 gained nearly 20 points on the positive news!

What To Expect Moving Forward

Economic conditions in China have been a major concern for quite a while now. However, with major stimulus put in place, we can expect to see growth in the region; which should bleed into the global economy. The positive news from China coupled with overall positive earnings reports so far should cause momentum to continue in the upward direction. The only thing that could stop the momentum now is if we started to see major losses on some of the key earnings reports that are coming out this week and next.

What Do You Think?

Where do you think markets are headed? We'd love to read your opinion in the comments below!