Stocks Fall From Session Highs

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The markets pulled back from the highs of the session in afternoon trading but remained in the green as market participants mulled corporate earnings and other encouraging developments from around the globe.

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Today's Markets

As of 3:10 p.m. ET, the Dow Jones Industrial Average jumped 73.8 points, or 0.6%, to 12467, the S&P 500 gained 12 points, or 0.94%, to 1293 and the Nasdaq Composite gained 28.3 points, or 1%, to 2705.

The markets have had a strong start to the year; indeed, the Dow is trading at its highest level since July 26, according to data compiled by FOX Business.

Alcoa (NYSE:AA) kicked off earnings season after the closing bell on Monday. The aluminum giant posted a quarterly loss of 3 cents per share, which came in-line with analysts' expectations, but its revenue of $6 billion topped forecasts of $5.7 billion. The company also said it expects demand for aluminum to increase by 7% this year.

This helped boost mining stocks and expectations about corporate earnings in light of growing headwinds from Europe. Market participants also cited a slew of news from overseas as having fueled Tuesday's rally.

China's imports grew at a rate of 11.8% in December, much slower than the 18% pace economists' projected, and just slightly more than half of the 22.1% it hit in November. The data highlight increasing concerns that the world's second-biggest economy is slowing down. However, the particularly weak data stoked anticipation that Beijing may enact a more accommodative monetary policy to boost growth, which traders say could be a positive development for equities.

In Europe, France's industrial production rose by 1.1%, zipping by estimates of a 0.2% fall. France is the continent's second-biggest economy and worries about its weakening economy have been partially to blame for speculation that it may lose its pristine 'AAA' credit rating.

Separately, ratings company Fitch said it doesn't expect to downgrade the country this year barring a "strong worsening" of the situation in the euro zone, AFP quoted a spokesperson as saying.

However, the situation in the euro zone remains fragile. German Chancellor Angela Merkel and French President Nicolas Sarkozy said on Monday Greece needs to reach a deal with private debt holders to cut its debt before the European Union and International Monetary Fund will pay the country's next aid tranche. Meanwhile, Italy's 10-year note recently yielded 7.17% -- a painfully-high level.

The euro climbed 0.15% to $1.2784, while European blue chips soared 2.7%. The U.S. dollar fell 0.98% against a basket of six world currencies.

Energy futures rallied, tracking strength in equity markets, a weaker dollar and continued worries about tensions between the U.S. and Iran. The benchmark crude oil contract traded in New York jumped 93 cents, or 0.92%, to $102.24 a barrel. Wholesale RBOB gasoline rose 0.5% to $2.773 a gallon.

In metals, gold climbed $23.50, or 1.5%, to $1,631 a troy ounce. Traders sold U.S. government debt as they moved into equities, pushing yields higher. The benchmark 10-year Treasury recently yielded 1.988% from 1.975%.

Foreign Markets

European blue chips jumped 2.7%, the English FTSE 100 rose 1.5% to 5,697 and the German DAX rallied 2.7% to 6,163.

In Asia, the Japanese Nikkei 225 climbed 0.38% to 8,422 and the Chinese Hang Seng gained 1.1% to 4,152.

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