Traders work on the floor of the New York Stock Exchange
Traders work on the floor of the New York Stock Exchange Reuters

The stock market has rallied modestly on U.S. mergers and acquisitions (M&A) activity and China’s continued support for European Union’s (EU) sovereign debt market.

The Dow Jones Industrial Average rose 45.64 points, or 0.40 percent, to trade at 11,523.77 at 2:29 p.m. EDT. The S&P 500 climbed 6.82 points, or 0.55 percent, to trade at 1,253.90. The Nasdaq Composite rose 0.65 percent.

Financials were boosted by Toronto-Dominion Bank’s (NYSE:TD) acquisition of Chrysler Financial for $6.7 billion. U.S.-traded Toronto-Dominion shares rose 2.82 percent.

Other big banks are trading up as Wells Fargo (NYSE:WFC) rallied 2.09 percent, American International Group (NYSE:AIG) jumped 3.14 percent, JPMorgan (NYSE:JPM) rose 2.60 percent, and U.S.-traded shares of Royal Bank of Scotland (NYSE:RBS) surged 4.18 percent.

Financials may also be boosted by China’s continued confidence in Europe’s sovereign debt situation after Chinese Vice-Premier Wang Qishan made pro-EU comments at the EU-China High Level Economic and Trade Dialogue.

A few months ago, China said EU sovereign debt will continue to be a part of its foreign exchange reserve portfolio. This comment, combined with its continued buying of EU debt, prevented the euro from collapsing, according to billionaire investor George Soros.