Stocks rallied Monday, building off of their best weekly performance in a month, as a pledge by the G20 to keep stimulus in place spurred investors' appetite for risk.
The Dow Jones Industrial Average jumped 203.52, or 2 percent, to close at 10,226.94, a new high for 2009. The S&P 500 gained 2.2 percent and the Nasdaq advanced 2 percent.
Finance ministers and central bankers from the G20 nations agreed over the weekend to keep stimulus flowing, sending the dollar down and stocks up.
The dollar fell across the board. Oil rose $2, settling at $79.43 a barrel. Gold settled at $1,100.80 an ounce, after hitting a new record above $1,110 earlier.
There was some concern after last Friday's jobs report showed unemployment topped 10 percent for the first time in 26 years. But Michael Cohn, chief investment strategist at Atlantis Asset Management, said the dollar going down and unemployment being high aren't necessarily bad for the market.
"You have to understand that the stock market isn't the economy," Cohn said. If companies are laying off workers and currency-exchange rates remain favorable, it "means they're more profitable."
Still, he said there may not be much more to go for this market, now that the Dow has essentially retraced 50 percent of its fall from 14,000 to 6,500. He said the market will probably chop around through the end of the year and he would probably take some chips off the table in the retail and commodities sectors.
Materials and financials were the day's top performers: American Express, Bank of America and Caterpillar led the Dow; All three gained more than 4 percent.
McDonald's rose 1.5 percentafter the fast-food chain said same-store sales slipped 0.1 percent but beat expectations. Stifel Nicolaus raised its fourth-quarter earnings estimate for the company by a penny to $1.04 a share; the current consensus estimate from Thomson Reuters is $1.02.
A lot of M&A news today: General Electric jumped 3.4 percent following news that the conglomerate and Comcast have agreed on a valuation of around $30 billionfor a joint venture between NBC Universal and Comcast. GE is the parent of CNBC.
And Kraft was the lone decliner on the Dow, down 0.9 percent, after the company's proposed takeover of Cadburyturned hostile. Cadbury rejected the offer, calling it "derisory." Kraft hasn't raised its offer and, in fact, the offer is actually now worth less than it was when Kraft initially proposed it a few months ago as Kraft shares have dropped since then.
"We continue to have a positive outlook for continued momentum and industry-leading fundamentals," the analyst said.
Sprint Nextel shot up more than 20 percent after the wireless provider said it will invest at least another $1 billion into Clearwire, a broadband company it jointly owns with Comcast, Intel, Time Warner Cable and Bright House Networks. The partners are prepared to spend another $500 million, according to a report in the Wall Street Journal.
The paper reported that Google , which also is a partner, isn't involved in the latest financing round.
Chip makers rallied after Wells Fargo raised its 2010 forecast for the sector.
U.S.-traded shares of Nokia rose 2.7 percent after the handset maker announced it will replace 14 million phone chargers made by China's BYDbecause of problems that could result in electric shock for consumers.
Altria shares advanced 1.8 percent after Barron's wrote that the tobacco products company was a bargain because of its low multiple, high yields and strong brands.
Good news for the auto sector: Parts maker Lear said it has emerged from bankruptcy protection with a healthier balance sheet and a backlog of new business.
Las Vegas Sands shares jumped 9.4 percent after the company and China's Minsheng bank set the price range for the upcoming public offering on the Hong Kong exchange. They hope to raise $7.35 billion with the offering.
Retail stocks finished mostly higher but Gap skidded 0.5 percent after Barclays downgraded the stock to "equal weight" from "overweight" over concerns on November sales.
As the end of the year approaches, more attention will be paid to just how strongly stocks have come back from the depths they reached back in March: Both the Nasdaq and the S&P 500 are on pace to chalk up their best annual percentage gains since 2003.
The Treasury began another record-setting week of auctions: Today's record $40 billion auction of three-year notes was met with strong demand. In all, the Treasury will auction $91 billion of debt this week. Still to come: The 10-year auction on Tuesday and the 30-year auction on Thursday.
The most notable of the day's earnings reports will come after the bell, as we get the latest quarterly numbers from Electronic Arts , Fluor , MBIA , and Priceline.com .
Volume was slightly below average: Roughly 1.24 billion shares changed hands on the New York Stock Exchange. Advancers outpaced decliners, 5 to 1.
— Reuters contributed this article.
MONDAY: Banks' deadline for capital-raising plans; 20th anniversary of Berlin wall coming down; Three-year note auction; Earnings from Electronic Arts after the bell
TUESDAY: Obama in Asia; Geithner in Japan; Foreclosure-prevention summit; Fed's Lockhart, Yellen & Fisher speak; 10-year auction
WEDNESDAY: Veterans' Day (offices, bond market closed); Bill Gates speaks; Forbes most powerful people list; weekly mortgage applications; Earnings from Macy's, Applied Materials
THURSDAY: FDA meeting on Internet advertising starts; Buffett/Gates/CNBC Town Hall meeting; Geithner at APEC meeting in Singapore; weekly jobless claims; weekly crude inventories; Treasury budget; Earnings fro mWal-Mart, Disney
FRIDAY: NY Fed conference on financial intermediation; international trade; import/export prices; consumer sentiment; Nicholas Cosmo court appearance; Fed's Evans speaks; Earnings from JCPenney, Abercrombie
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