Bulls Stage a Comeback

Updated from 4:14 p.m. EDT

Stocks surged Monday as a late-afternoon buying spree, buoyed by gains in financial stocks, helped the market recover much of its losses from the prior session's selloff.

The Dow Jones Industrial Average jumped 286.87 points, or 2.18%, to 13,468.78. It was the Dow's eighth 100-point move in the last 11 sessions, highlighting the recent volatility that traders have had to endure.

Dow components American Express (AXP Quote - Cramer on AXP - Stock Picks), AIG (AIG Quote - Cramer on AIG - Stock Picks), and Citigroup (C Quote - Cramer on C - Stock Picks) supported the index with gains of 4.7% or more.

The S&P 500 reversed early weakness and added 34.61 points, or 2.42%, to 1467.67. The Nasdaq Composite climbed 36.08 points, or 1.44%, at 2547.33.

Several bank-related indices, which had been beaten down by credit-market worries, powered higher. The KBW Bank Sector Index jumped 5.4%, the Dow Jones U.S. Banks Index added 4.8%, and the Nasdaq Financial 100 Index rose 3.9%.

The big gains came in a period of heavy volatility for the market as investors fret about the mounting woes in the debt markets. In particular, the last hour of trading has seen a rush of buying and selling, and indeed, the latest rally accelerated right before the closing bell.

"A lot of the market activity has been unusual, and this late-day push is no exception," said Edgar Peters, chief investment officer with Pan Agora. "Some of this rally is due to bargain-hunting, some of it is short-sellers getting squeezed, and it's also partially an overdue bounce."

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