U.S. stocks rallied for a fourth day, erasing losses for the year in the Standard & Poor™s 500 Index, as the European Central Bank unveiled an expanded stimulus plan and banks and transportation companies surged amid better-than-forecast earnings.
KeyCorp led gains among banks after fourth-quarter results topped analyst estimates. Southwest Airlines Co. jumped 8.4 percent as profit rose 71 percent on lower jet fuel prices. Union Pacific Corp. added 4.8 percent as a strengthening U.S. economy and growing construction market boosted traffic on the rails in the fourth quarter. EBay Inc. increased 7.1 percent after entering a standstill agreement with activist investor Carl Icahn.
The S&P 500 gained 1.5 percent to 2,063.31 at 4 p.m. in New York, the highest since Dec. 30. The gauge climbed above its average price for the past 50 days. The Dow Jones Industrial Average climbed 264.36 points, or 1.5 percent, to 17,818.64. The Russell 2000 Index surged 2.1 percent. Trading in S&P 500 companies was 24 percent above the 30-day average for this time of the day.
The Chicago Board Options Exchange Volatility Index, known as the VIX, lost 13 percent, the most since December, to 16.45.