Stocks were inched higher on Monday as investors turned their attention towards ongoing debt ceiling negotiations following back-to-back weekly losses for the Dow Jones Industrial Average and S&P 500 Index.

Here's how the market settled on Monday:

S&P 500 Index (SPY  ): +0.30% or +12.20 points to 4,136.28

Dow Jones Industrial Average (DIA  ): +0.14% or +47.98 points to 33,348.60

Nasdaq Composite Index (QQQ  ): +0.66% or +80.47 points to 12,365.21

The Dow and S&P 500 lost 1.1% and 0.3%, respectively, last week as concerns about a looming recession and the lack of a deal regarding the upcoming U.S. debt ceiling limit in June hampered market sentiment. That potential U.S. default is expected to be the main driver behind market moves this week, with President Joe Biden scheduled to meeting with House Speaker Kevin McCarthy and other congressional leaders on Tuesday to resume budget negotiations.

U.S. Treasury Secretary Janet Yellen signaled in an interview with The Wall Street Journal over the weekend that the U.S. would avoid a default.

"I'm hopeful. I think the negotiations are very active. I'm told they have found some areas of agreement," Yellen said. Yellen has previously said that failure to reach an agreement on the debt ceiling before June 1 would "produce financial chaos,"quoted by CNBC.

Elsewhere, JPMorgan Chase (JPM  ) CEO Jamie Dimon said late last week that the largest U.S. bank by assets has established a "war room" to research multiple scenarios if the debt limit is not raised in time.

"We've got to be very careful about getting close," to a default, Dimon said, quoted by Reuters. "It's very unfortunate, it's time-consuming, hopefully it won't happen, but it affects contracts, collateral, clearing houses, [and] clients."

Beyond the debt ceiling, market participants will turn their attention to testimony from former executives from Silicon Valley Bank and Signature Bank before the Senate on Tuesday. The earnings season is still underway as well, with retail names like Walmart (WMT  ), Target (TGT  ), Home Depot (HD  ), Alibaba (BABA  ) and Tencent (TCEHY  ) set to report this week.

In economic news on Monday, manufacturing activity in the New York area declined in May, with new orders and shipments falling as prices rose, according to the Federal Reserve. The Empire State Manufacturing survey declined 43 points from April to a reading of -31.8, while new orders fell 53 points and shipments dropped more than 40 points.

In single-stock news, shares of Magellan Midstream Partners (MMP  ) rose by double-digits after pipeline operators Oneok (OKE  ) announced it is acquiring the company for about $18.8 billion.

Shares of H&R Block (HRB  ) and Intuit (INTU  ) fell on Monday after a WSJ report said the U.S. government may be creating an online tax filing program, with the IRS expected to release a report this week.

Microsoft's (MSFT  ) planned acquisition of Activision Blizzard (ATVI  ) crossed a key regulatory hurdle on Monday after the European Commission approved the $69 million deal.

Looking ahead, investors will get a view of the health of the consumer as from April's U.S. retail sales report as well as Home Depot earnings on Tuesday.