Stocks climbed Monday, reversing three days of losses, as investors snapped up beaten-down stocks and bet there would be a near-term resolution to Greece's financial future.
The Dow Jones Industrial Average gained, led by BofA and Microsoft , after ending lower last weekamid continuing jitters over the euro zone debt crisis.
The S&P 500 and the tech-heavy Nasdaq were higher. The CBOE Volatility Index, widely considered the best gauge of fear in the market, slipped below 21.
Financials and utilities were the biggest gainers among the S&P sectors, while materials lagged.
The Greek parliament was debating a fresh austerity package but the government is fragile and analysts fear that it may not pass. The euro slipped against the dollarahead of the vote.
Meanwhile, regulators proposed higher tier one capital ratios for big and systemically important banks over the weekend.
Rochdale Securities vice president for equity research Dick Bove wrote in a market note that the new proposals, if enacted, might trigger a global recession as banks would cut down on lending even more.
In a separate note, Bove said BofA stock is "massively undervalued."
Rivals Citigroup , GoldmanSachs and Morgan Stanley were higher. Despite the day's rally, the sector is still the worst performer in 2011.
The Bank for International Settlements said interest rates must rise in order to fight global inflation and that delays in cutting budget deficits may make the sovereign crisis even worse.