Stocks Call It a Good Day

Updated from 4:25 p.m. EDT

The major stock indices in New York closed solidly higher after spending the entire session in positive territory thanks to a boost from financials and better-than-expected economic data.

The Dow Jones Industrial Average rose 214.33 points, or 2.6%, to 8426.74, closing near its highest level of the day. The S&P 500 gained 29.72 points, or 3.4%, to 907.24, a level not seen since Jan. 9. The Nasdaq gained 44.36, or 2.6%, to 1763.56.

American Express(AXP Quote) and Bank of America(BAC Quote) were the Dow leaders, rising 12.3% and 19.3%, respectively.

Citigroup(C Quote) and JPMorgan Chase(JPM Quote) rose 7.7% and 10.2%, and the KBW Bank Index gained 14.7%.

Among other Dow stocks, Alcoa(AA Quote) and DuPont(DD Quote) tracked up 6.2% and 5.5%, while Intel (INTC Quote) climbed 5.4%.

It marks just the third time this year that the opening session of the week was positive for the index; Jan. 26 and March 23 were the other two times.

The major indices rose as much as 1.6% last week, resuming gains that were extended for six weeks before a hiccup the prior week. Those gains came despite a Chrysler bankruptcy filing and worries about the swine flu.

Part of the reason the rally has extended so far is because so many people missed it and were forced into play from a performance standpoint, says Jeffrey Saut, Raymond James chief investment strategist. "Every new bull market has started as a short-covering bear market rally," he says, but even so, very few rallies have extended much beyond this one.

Economic data were doing nothing to discourage advances, however. The National Association of Realtors said the pending home sales index picked up by 3.2% in March, topping a 2.1% increase in February, and vs. the expectation of no improvement.