U.S. stocks rose on Tuesday, as investors bet that the U.S. Federal Reserve will stick to its accommodative policy to foster the economic recovery, boosting growth-sensitive sectors such as financials, technology and industrials.

Signs that the U.S. Treasury's $43 billion auction of new two-year notes met strong demand added to the positive tone.

Investors have scrutinized auction results closely this year, especially after worries surfaced back in May about the longevity of the United States' prized AAA credit rating.

People are putting some credibility in the fact that maybe the recession is behind us and the worst is over, said Dan McMahon, senior managing director of equity trading at Raymond James Financial Inc in New York. Things seems to be trending in the right direction as far as the underlying economic data.

The Dow Jones industrial average <.DJI> rose 53.88 points, or 0.55 percent, to 9,832.74. The Standard & Poor's 500 Index <.SPX> climbed 7.28 points, or 0.68 percent, to 1,071.94. The Nasdaq Composite Index <.IXIC> gained 8.98 points, or 0.42 percent, to 2,147.02.

The U.S. dollar's slide to a one-year low against the euro helped propel global commodity prices higher, with U.S. front-month crude up 2.6 percent, or $1.84, to settle at $71.55 a barrel, while spot gold rose toward an 18-month high approaching $1,020 an ounce.

The Federal Reserve began a two-day policy-setting meeting on Tuesday. Its policy statement is due on Wednesday around 2:15 p.m. (1815 GMT).

And with no change expected in interest rates, investors probably will focus on the bank's assessment of the economic outlook, particularly after Chairman Ben Bernanke said last week that the recession was technically over.

Among standouts, Citigroup shares jumped 5.2 percent to $4.66 following news that Singapore wealth fund GIC has cut its stake in the U.S. banking company in half.

The S&P 500 financial index <.GSPF> was up 2.2 percent.

(Editing by Jan Paschal)