US stocks rallied Thursday, boosted by positive fresh data pointing to resilience in the US economy.
The Dow Jones Industrial Average jumped 135.63 points (1.12 per cent) to finish at 12,287.04.
The broader S&P 500 added 13.38 points (1.07 per cent) to 1,263.02, while the tech-rich Nasdaq Composite gained 23.76 points (0.92 per cent) to 2,613.74.
"US stocks moved nicely higher in another holiday-induced low-volume session, as traders welcomed some favourable US economic data that helped push the S&P 500 Index back into the black for the year," Charles Schwab analysts said.
The blue-chip Dow erased most of its Wednesday losses, with all 30 of its stocks finishing higher.
The upbeat tone on Wall Street was present since the opening bell, Briefing.com analysts said, with bulls inspired by better-than-expected reports on the US housing and manufacturing markets.
Pending sales of US homes hit their highest level since April 2010, while manufacturing activity in the key Chicago region remained strong.
The weekly jobless claims reading showed a decline but confirmed the broader trend of improvement in the depressed labour market.
"Despite the uptick in initial claims, the US labour market continues to show signs of gradual improvement," said Robert Kavic of BMO Capital Markets.
Investors also were mildly encouraged by Italy's debt auction amid worries that its economy could be swept up in the eurozone debt crisis.
Italy scraped through a key bond auction test, raising 7.0 billion euros ($9.1 billion). That was less than the 8.5 billion euros the government targeted because of weak demand, but the interest rate paid came in below the danger threshold of 7.0 per cent.
Financials led the advance. On the Dow, Bank of America surged 3.3 per cent, JPMorgan Chase gained 2.4 per cent and insurer The Travelers Companies rose 1.3 per cent.
Amazon recovered from earlier losses to finish almost flat, down 0.02 per cent, after a Goldman Sachs analysis said that new data on holiday internet shopping suggested forecasts for the company's fourth quarter could be over-optimistic.
Bond prices were mixed. The yield on the 10-year Treasury slipped to 1.90 per cent from 1.91 per cent on Wednesday, while the 30-year rose to 2.91 per cent compared with 2.90 per cent a day earlier.
Bond prices and yields move in opposite directions.