The Dow Jones industrial average gained rose 76.03 to 6,547.79, its best one-day gain since a 96-point advance on Nov. 6. Today's gain was the Dow's 12th record close in the last 14 sessions, bringing November's advance to 8.6 percent and the year's gain to about 28 percent. Advancers led decliners by an 11-to-6 margin on the New York Stock Exchange, with 1,649 up, 904 down and 796 unchanged. NYSE volume was 475.25 million shares, vs. 525.20 million Friday.
Broader measures also set new highs, led by banks and other financial services issues that would benefit from the improving interest rate environment.
The S&P 500 jumped 8.30, or 1.1 percent, to 757.03. The NYSE composite index rose 4.20 to 398.86. The Nasdaq composite rose 6.15 to 1,280.51, and the American Stock Exchange's market value index fell 2.61 to 588.16.
Stocks started the session weak, but quickly turned higher, padding Friday's late rally, as bonds rose on the latest indication that the economy has slowed from the robust - and potentially inflationary - pace of earlier this year.
The National Association of Realtors reported that sales of existing homes fell 1.5 percent in October, the fifth consecutive monthly decline. The markets have been cheered since late summer by a stream of similarly mild readings that has helped persuade the Federal Reserve not to slow the economy with an increase in the central bank's key lending rates.
As bond prices rose today, the yield on the 30-year Treasury bond - a key determinant of corporate and consumer borrowing costs - touched last week's eight-month low at 6.40 percent before settling at about 6.42 percent, down from 6.44 percent late Friday.