Boeing led the Dow, surging 2.2 percent after President Donald Trump announced a $110 billion arms deal sale to Saudi Arabia during his visit to the country over the weekend.

Other defence companies such as Lockheed Martin and Northrop Grumman also posted strong gains.

Ford advanced 1.4 percent after the company announced a management shakeup, naming Jim Hackett to replace Mark Fields as president and CEO amid declining sales in the US and Chinese markets. The move comes as Ford faced pressure from investors over its weak share price.

About 15 minutes into trading, the Dow Jones Industrial Average was up 0.5 percent to 20,910.69.

The broad-based S&P 500 rose 0.4 percent to 2,391.71, while the tech-rich Nasdaq Composite Index gained 0.5 percent to 6,113.72.

US stocks fell sharply last Wednesday on worries about Trump's agenda after a series of scandals and stumbles, but have pushed higher since then.

Chemical company Huntsman rose 2.6 percent on news it would merge with Swiss group Clariant create a trans-Atlantic chemicals giant with a combined value of around $20 billion.