Stocks rose for a third day on Thursday on relief that a ratings cut by S&P in General Electric was just one notch and that no further cuts loomed, while retail sales data showed some stabilization in consumer spending.
Wall Street closed out its best three-day run since the end of November after GE
Investors had feared the credit rating downgrade would be deeper or the outlook negative.
The outlook was stable. That's very good news, said Hugh Johnson, chief investment officer of Johnson Illington Advisors in Albany, New York. It wasn't quite as bad as it could have been.
Wal-Mart Stores Inc
The Dow Jones industrial average <.DJI> climbed 239.66 points, or 3.46 percent, to 7,170.06. The Standard & Poor's 500 Index <.SPX> jumped 29.38 points, or 4.07 percent, to 750.74. The Nasdaq Composite Index <.IXIC> added 54.46 points, or 3.97 percent, to 1,426.10.
The Dow closed above 7,000 for the first time since February 27, but remains down 46 percent from its record close in October 2007.
For the third straight day, comments from a top banker spurred battered bank shares sharply higher.
Bank of America
Lewis' comments echoed statements by Citigroup
Bank of America's stock surged nearly 19 percent to $5.85 and JPMorgan gained 13.7 percent to $23.20. The KBW banks index <.BKX> shot up 11.2 percent.
Investor sentiment also got a lift from a flurry of takeover activity in the biotechnology sector, driving up shares of health-care companies. The Amex Biotechnology index <.BTK> leaped 6 percent.
On Nasdaq, biopharmaceutical company Gilead Sciences Inc
Gilead shares gained 0.9 percent to $44.43, while CV's shares soared 31.5 percent to $21.04.
Shares of peer Celgene Corp
Dow component Pfizer
Shares of General Motors
Trading was active on the New York Stock Exchange, with about 1.81 billion shares changing hands, above last year's estimated daily average of 1.49 billion, while on Nasdaq, about 2.44 billion shares traded, above last year's daily average of 2.28 billion..
Advancing stocks outnumbered declining ones on the NYSE by about 11 to 1, while on the Nasdaq, more than four stocks rose for every one that fell.
(Editing by Jan Paschal)