U.S. benchmark oil surged 7 percent on hopes that a seven-month collapse in prices that had rattled financial markets was ending. All 10 industry sectors of the Standard and Poor’s 500 index rose, leading a 2.8 percent gain in energy shares.
Stocks climbed from the start following a rally in European markets on signs that Greece’s new government won’t press for a write-off of the country’s bailout loans.
The S&P 500 index climbed 29.18 points, or 1.4 percent, to 2,050.03. The Dow Jones industrial average jumped 305.36 points, or 1.8 percent, to 17,666.40. The Nasdaq rose 51.05 points, or 1.1 percent, to 4,727.74.
Investors are hoping that oil prices have found a floor after falling as much as 60 percent from their recent peak last June. Prices have risen 19 percent in four days as producers have canceled exploration projects and cut the number of rigs drilling for oil.
On Wednesday, the Energy Department releases its closely-followed weekly report on U.S. oil supplies.
The stock market got off to a bad start this year. The S&P 500 sank 3 percent in January, its worst monthly performance in a year. With Tuesday’s gains, the index is now down just 0.4 percent so far in 2015.
Automakers were among the big winners as investors responded to reports of strong vehicle sales last month. Ford rose 38 cents, or 2.5 percent, to $15.65. General Motors climbed 87 cents, or 2.6 percent, to $33.98.
Overall, vehicle sales rose 14 percent to 1.15 million last month, according to Autodata Corp. It was the best January in nine years.
The main indexes in France and Britain each rose more than 1 percent after a report that Greece’s finance minister had suggested in a meeting Monday in London that its debt be replaced with bonds that would be repaid only if Greece’s economy grows.
Among other stocks making big moves:
– Office supply chain Staples jumped $1.87, or 11 percent, to $19.01 following a report in the Wall Street Journal that the company is in advanced talks to combine with Office Depot. Office Depot leapt $1.65, or 22 percent, to $9.28.
– AutoNation rose $3.83, or 6.5 percent, to $63.17 after the country’s largest chain of car dealerships reported income that beat Wall Street’s estimates.
– The New York Times rose 7.6 percent and Gannett gained 5.7 percent after the media companies each reported quarterly earnings that exceeded analysts’ expectations. The New York Times rose 97 cents to $13.73. Gannett rose $1.81 to $33.32.
The euro was little changed at $1.1505. The dollar fell 0.2 percent to 117.27 yen.
U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 1.79 percent from 1.67 percent. Gold fell $16.60 to $1,260.30 an ounce, silver rose seven cents to $17.32 an ounce and copper rose nine cents to $2.58 a pound.
In other oil futures trading in New York:
- Wholesale gasoline rose 5.67 cents to $1.601 a gallon
- Heating oil jumped 8.9 cents to $1.847 aa gallon
- Natural gas gained 7.4 cents to $2.754 per 1,000 cubic feet.