Stocks extend 4-week rally; Dow ends day near 8,000

NEW YORK (AP) — Investors dived into stocks Thursday, extending a rally that gave the Dow Jones industrial average its best four weeks since 1933.

Stocks rose across the board in heavy trading after an accounting rule change that will help banks and commitments from world leaders to toughen up regulatory oversight of financial institutions.

The Dow Jones industrials broke through 8,000 for the first time since Feb. 9 but ended slightly below that level ahead of a closely watched monthly report on employment early today that could easily upset the market if it comes in below expectations.

The Dow is now up 20.4 percent over the last month, its biggest percentage gain in a four-week period since the spring of 1933. Bits of good news about the economy in recent weeks, including better-than expected-numbers on the housing and manufacturing sectors, have given investors more reasons to buy.

According to preliminary calculations, the Dow rose 216.24, or 2.8 percent, to close at 7,977.84, after earlier rising as much as 314 points.

Broader market indicators also rose sharply. The Standard & Poor’s 500 index gained 23.30, or 2.9 percent, to 834.38. The Nasdaq composite index rose 51.03, or 3.3 percent, to 1,602.63.

Industrial and consumer discretionary stocks picked up speed Thursday while demand for safe-haven assets such as gold, Treasurys and the dollar plummeted.

“Everyone is in a buying mood,” said Eric Ross, director of research at brokerage Canaccord Adams. “Everyone is feeling good. ... A lot of this is simply confidence.”

The market has managed to shrug off some negative data on employment recently such as initial claims for jobless benefits, but a far more important reading on the job market is coming up early today, the monthly report from the Labor Department. A bad reading on that figure could easily disrupt the market’s newfound sense of optimism. The unemployment rate is expected to rise to 8.5 percent from 8.1 percent in February.

Banking shares got a significant boost after a rule-making body for the accounting industry relaxed financial reporting rules that force banks to value their assets at current market prices.

The change in “mark-to-market” accounting rules, which should help banks reduce losses, sends another lifeline to the troubled financial industry. Many investors believe financial stocks, which have largely carried the market’s four-week rally, are a gauge of when the economy is turning.

The conclusion of a one-day summit in London of the world’s finance ministers sent stocks to their highest levels in early afternoon trading. Though the G-20 leaders did not satisfy calls for new stimulus measures, they pledged an additional $1.1 trillion in financing to the International Monetary Fund and declared a crackdown on tax havens and hedge funds.

Another positive indicator on the economy also lifted sentiment on Wall Street. Factory orders posted a large increase in February, coming on the heels of better-than-expected readings on pending home sales, manufacturing activity and auto sales the day before.