As per the stocks rallied Monday, with the , as investor optimism gained momentum.
The Dow Jones industrial average (INDU) soared 204 points, or 2%, to close at 10,226.94 –marked as the highest level since Oct. 3, 2008.
Financial and commodity-related shares led the advance.The gains were broad-based, with all but 1 of the 30 components in the blue-chip index closing higher.
The S&P 500 (SPX) gained 24 points, or 2.2%, to settle at 1,093.07 and the Nasdaq composite (COMP) rose 42 points, or 2%, to close at 2,154.06.
Signs of continued global recovery and talk about deals boost to investor confidence. Dow gains 200 points; Nasdaq and S&P 500 jump 2%.
Stocks rallied right out of the gate on monday after the Group of 20 said over the weekend that it would keep economic stimulus in place.
With little news on tap for this week, “psychological factors and technical levels are driving 70%-80% of this market,” said one of the Financial Enhancement Group’s analyst
“The market does create its own psychology,” he added. For Example : “You would never go to the grocery store and pay a higher price because someone else did, but that’s what is happening in stocks — the momentum that’s happening today after G-20.”
Finance ministers of the G-20 met over the weekend and pledged to continue government aid. The dollar fell sharply against the euro and British pound, while commodities and commodity-linked stocks rose.
“People are reading the news and pondering out all of it,” Clark said. “Some stories might be enough for a quick boost, but as far as overall recovery is concerned most people are saying,that they’ll believe it when they’ll see it.'”
Oil, gold and the dollar. U.S. oil for December delivery rose $2 to settle at $79.43 a barrel, after sinking almost 3% on Friday’s mostly negative labor market report.
S&P and technical trading.
Financial Enhancement analyst Clark said more investors have “moved into the technical trading world.”
Still others are holding out for when the S&P crosses 1,100 and remains steady above that mark, he said.
“There are people on the sideline viewing this as an opportunity to get in,” Clark said. “Personally, I’ll be happy when I see the S&P holding above 1,100 — even though it’s psychological rather than technical.”
Eyeing corporate deals. With no significant economic indicators on Monday’s docket, investors focused on corporate news, particularly talk about deals — possible and completed.
Kraft (KFT, Fortune 500) launched a $16.3 billion hostile takeover bid Monday for British candymaker Cadbury after the deadline for the initial bid passed without a deal. Cadbury rejected Kraft’s initial $16.7 billion offer in early September and again turned it down.
World markets and bonds:
Asian shares closed higher, with Japan’s Nikkei adding a modest 0.2% and the Hang Seng in Hong Kong jumping 1.7%.
Major European indexes closed almost at 2% higher, with the German DAX leading the way at a 2.4% gain.
Bond prices were mostly lower, with the 10-year note holding modest gains, as the government began selling $81 billion worth of debt this week in a quarterly refunding.
Treasury auctioned $40 billion in 3-year notes Monday, with $25 billion in 10-year notes and $16 billion in 30-year bonds being offered later in the week.
Market breadth was positive. On the New York Stock Exchange, winners topped losers by five to one on volume of 909 million shares. On the Nasdaq, advancers topped decliners almost two to one on volume of 1.2 billion shares. To top of page