By Richard Leong
NEW YORK (Reuters) - U.S. stocks rose on Monday, building on last week's rally as investors continued to digest corporate results, while the dollar reached a two-week high against the yen after Japan posted a record trade deficit.
The S&P 500 index rose for a fifth straight day, the longest winning streak since October. The S&P 500 last week jumped 2.7 percent, the biggest weekly rise since July.
Trading volume was lighter-than-usual with financial markets in European and many Latin American countries still closed for the Easter holiday.
While conflict in Ukraine lingered on Monday, tensions over the region played less of a role in markets, though they were likely to limit losses in the yen, a traditional safe-haven currency.
Support for the yen ebbed last week after the United States, Russia, Ukraine and the European Union called for an immediate halt to violence. Still at least three people were killed early Sunday near a Ukrainian city controlled by pro-Russian fighters.
Prices of U.S. Treasuries, another safe-haven, were little changed on Monday.
Wall Street activity was subdued on Monday, as trading resumed after the three-day holiday weekend.
"We are certainly in a wait-and-see mode for earnings, which can be volatile, and therefore a lot of money is just waiting on the sidelines to see what happens," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
The Dow Jones industrial average rose 40.52 points, or 0.25 percent, to 16,449.06, the S&P 500 gained 6.94 points, or 0.37 percent, to 1,871.79, and the Nasdaq Composite added 26.03 points, or 0.64 percent, to 4,121.546.
After the closing bell, Netflix Inc reported a higher quarterly profit, boosted by the addition of 2.25 million customers to its movie and TV streaming service in the United States. Its shares jumped 6.8 percent to $372 in extended trade.
Later in the week, Apple Inc, Microsoft, McDonald's and AT&T are also scheduled to report earnings. The MSCI world equity index, which tracks shares in 45 nations, was little changed at 411.04.
Earlier, Tokyo's Nikkei index dipped 0.03 percent.
In the currency market, the dollar inched up 0.2 percent against the yen, to 102.53 yen after earlier touching 102.70 yen, its highest level since April 8.
Analysts said U.S. economy has shown signs of regaining some momentum after a harsh winter, which would buoy the dollar.
The yen slid after the government data showed Japan's trade deficit at a record 13.75 trillion yen ($134.45 billion) for the fiscal year that ended in March. Analysts said the weak trade figure raise the chances the Bank of Japan might consider more stimulus to help its economy.
Last week's stock gains and encouraging data on U.S. jobs and factory activity had spurred some selling in U.S. Treasuries overnight, sending benchmark yields up to 2.845 percent, the highest level since January. They later retreated to 2.717 percent, little changed from late Thursday.
In commodity markets, gold initially edged higher as the Ukraine tensions sparked some safe-haven buying but it fell to a 2-1/2-week low on the stronger dollar and heavy outflows from the world's biggest bullion-backed exchange-traded fund.
Spot gold fell $4.85 or 0.37 percent, to $1,288.80 an ounce after falling to $1,281.40 earlier, lowest since April 3.
The worries over Ukraine supported oil.
Brent crude settled up 42 cents or 0.38 percent at $109.95 a barrel, retreating from a near a six-week peak of $110.36 set last week. U.S. crude settled 7 cents or 0.07 percent higher at $104.37.
(Additional reporting by Ryan Vlastelica, Chuck Mikolajczak, Gertrude Chavez-Dreyfuss in New York, and Shinichi Saoshiro in Tokyo,; Editing by Leslie Adler)