Updated from 4:11 p.m. EST

Stocks rallied Wednesday, with health care, defense and energy stocks leading the way, as President George W. Bush won a second term in another close race for the White House.

Kerry conceded late Wednesday morning amid a close race in Ohio and glitches in Iowa.

The Dow jumped 101.30 points, or 1.01%, to 10,137; the S&P 500 gained 12.62 points, or 1.12%, to 1143.20, just 14 points shy of its 2004 high touched in February; while the Nasdaq added 19.54 points, or 0.98%, to 2004.33, closing above the 2000 level for the first time since July 2. All the indices ended well off their session highs.

Volume was relatively heavy on the New York Stock Exchange where 1.7 billion shares changed hands with advancers ahead of decliners 7 to 2. On the Nasdaq, 1.9 billion shares traded and advancers beat decliners 7 to 3.

The election outcome this time turned on Ohio's 20 electoral votes. Bush beat Kerry by about 136,000 votes in the Buckeye State, but the Democratic challenger was initially relucant to accept defeat there, citing ballot issues. Ohio put Bush over the 270 electoral votes needed for official victory. The president won 51% of the popular vote, vs. 48% for Kerry.

"I think we're seeing a great relief rally because we're not going to see a repeat of the 2000 election," said Bill Livesay, senior market analyst at CyberTrader. "The economic situation is not going to change overnight, but it's important that this uncertainty is out of the way. Longer term, we're going to fall back on the economic data."

Livesay said the Nasdaq appeared to be "in better shape than the S&P 500 and the Dow," and he expects "a little pullback in energy stocks, which will likely weigh on the S&P."

"The uncertainty is behind us," said Arthur Hogan, chief market analyst at Jefferies.

As far as "sector specifics are concerned, we'll definitely see pharmaceuticals and energy stocks do better, but also dividend stocks," added Hogan.

"But I wouldn't necessarily get bogged down with the sector specifics," said Hogan. "I'd really focus on the fact that this market has been sideways for the better part of the last eight weeks due to the uncertainty of this election, and clearly, with that in the rearview mirror, today I think we have a broad market rally."

The election results were less obvious in other markets. The 10-year Treasury note was down 6/32, with the yield up to 4.07%. The dollar was moderately higher vs. the euro and the yen, while gold prices edged up.

Crude oil prices jumped Wednesday. A report from the Department of Energy showed U.S. crude inventories rose in the most recent week, but renewed concerns about supplies had more of an impact on trading. Crude oil closed $1.26 higher at $50.88, after losing 10% in the past week.

Another drop in oil was icing on the cake for investors, who rushed to stocks likely to benefit from a second Bush term, such as drugmakers.

Pfizer ( PFE) rose 75 cents, or 2.6%, to $29.45. Even Merck ( MRK), which has been beaten down over its Vioxx recall, climbed $1.07, or 4%, to $27.87.

Energy companies and defense contractors also were reflecting the dynamic. ExxonMobil ( XOM) rose 84 cents, or 1.7%, to $49.27. Lockheed Martin ( LMT) added $1.78, or 3.3%, to $55.89, and General Dynamics ( GD) rose $3.79, or 3.8%, to $104.27.

"You've got to wonder just how much more they have left in the defense sector," Livesay said. "They have had quite a move and they're probably a little extended. I suspect we'll see a little pause before we see any upside to them."

One clear loser was StemCells ( STEM). The biotech company focusing on stem cells as a cure for diseases fell 97 cents, or 23.6%, to $3.14. Kerry said he would have lifted the Bush-imposed limits on federally funded stem cell research.

Shares of other companies working in the field also fell sharply. Aastrom Biosciences ( ASTM) shed 22 cents, or 16.1% to $1.17, while Gernon ( GERN) dropped 97 cents, or 12.3%, to $6.95.

In a minor victory for stem cell medicine, California residents approved Proposition 71, which allocates $3 billion in state support for embryonic stem-cell research over the next 10 years. The proposition passed by a 20% margin and was supported by California Gov. Arnold Schwarzenegger.

On the economic front, the government said that factory orders declined for a second month in a row. For the month of October, factory orders fell 0.4% after dropping 0.1% in the prior month. Experts had expected a rise of 0.4%.

The Institute for Supply Management said that its service sector index rose to 59.8 in October, from 56.7 last month. Consensus estimates had called for a slightly smaller rise to 58.

In corporate news, a handful of clothing companies reported on Wednesday. Shares of Polo Ralph Lauren ( RL) closed higher, after the company said second-quarter sales were stronger than expected. On an adjusted basis, the company had earnings of $79 million, or 76 cents a share, up 49% year over year and better than Wall Street expectations of 73 cents a share. The stock finished up $1.40, or 3.7%, to $38.91.

Estee Lauder ( EL) said Wednesday that earnings climbed higher in the first quarter, driven by strength in European sales. The company managed to beat analysts' estimates of 37 cents a share, reporting a profit of 41 cents a share, up 23% from last year. Estee Lauder shares rose 92 cents, or 2.2% to $43.27.

Also in the news Wednesday was Tommy Hilfiger ( TOM), which delayed filing its second-quarter results amid a federal investigation into alleged tax evasion. Along with the news, Hilfiger also guided ITS year-long revenue estimates lower, citing weaker than expected fall sales.

Shares of Tommy Hilfiger fell 51 cents, or 5.4%, to $8.94.

Overseas stock markets gained ground. In Europe, London's FTSE 100 added 0.5% to 4718.50 and Germany's Xetra DAX finished roughly a point higher at 4039.04. Hong Kong's Hang Seng rose 0.7% to 13,397. The Nikkei was closed for a public holiday in Japan.