Stocks jumped on Monday as investors rode a wave of optimism fueled by new hope that European leaders will come together to solve the debt problems in the region. Germany and France will finalize plans to recapitalize the Euro Zone’s banks by next month, French President Nicolas Sarkozy and German Chancellor Angela Merkel said at a press conference over the weekend.
It was enough to get bank stocks rolling again, and Citigroup (C) ended the day up 7.6%, leading the sector. The Dow jumped 330 points, its largest rise since August 11. The S&P 500 rose 39.4 points to 1,194.9, a 3.4% gain and the largest jump since August 11. In fact, the S&P 500 is now down about 12% since its peak in late April, after falling into bear market territory (down at least 20% from the peak) in intraday trading on Oct. 4.
Given that Monday was Columbus Day, volume was relatively light, with NYSE composite volume hitting 3.9 billion shares, down from this year’s average of 4.36 billion.
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