Wall Street kept its perfect streak in 2012 alive, closing solidly higher as investors looked to move beyond Europe's debt problems and gave U.S. banks a vote of confidence.
Stocks closed considerably off their highs for the day, but the light trading activity was good enough to seal another winning day.
The strongest gains came from materials, financials, industrials and energy stocks. Defensive sectors were the least buoyant as risk-on served as the day's theme.
The early-January rally — known as the "January effect" and often a bullish sign for markets — inspired hopes that US markets were beginning to overcome headline risk from the European debt crisis and moving toward a more independent track.
"We've been handcuffed by whatever happens in Europe," said Ryan Detrick, senior analyst at Schaeffer's Investment Research in Cincinnati. "Now we're starting to see a little decoupling from that. When you consider some of the recent economic strength we've had, it's a potentially good sign."
Since 1950, the market has started the year with five consecutive gains on 38 occasions. It ended the year positive 87 percent of the time, according to the Stock Trader's Almanac.
The Dow industrials have been up four out of the six trading sessions so far this year.
Optimistic outlooks from several companies propelled the day's momentum
Alcoa said demand for aluminum, used in cyclical industries such as aerospace and auto manufacturing, would increase in 2012. The company reported a loss excluding one-time items that was in line with expectations, but revenue exceeded Wall Street estimates.
Still, the stock could not hold earlier gains and turned flat to slightly negative as the day progressed.
Also in earnings, integrated circuit developer Cirrus Logic said it expects to show revenue growth of 28 percent for the quarter on strong demand. Stifel Nicolaus raised the company to a buy.
Yoga-wear manufacturer Lululemon boosted its outlook as well due to an increase in inventory, sending its shares sharply higher.