US stocks rose significantly Monday afternoon after Standard & Poor's (S&P) reiterated its top credit rating for bond insurer Ambac Financial and took rival MBIA off its credit watch list, calming concerns about problems in the sector spreading to the broader market. Stocks made modest gains through most of the session on beliefs that troubled bond insurer Ambac could reach an agreement Monday with a group of banks on a plan to raise capital to keep its business alive. Also helping investor sentiment was a U.S. existing-home sales report that showed a smaller-than-expected decline, though such sales fell to a nine-year low. However, stocks lost momentum in the mid-afternoon until S&P announced its new ratings on the bond insurers in the late afternoon. Shares of both Ambac and MBIA spiked on the news, boosting a variety of financial stocks and the overall market. Light sweet crude oil for April delivery rose 29 cents to $99.10 a barrel on the New York Mercantile Exchange. The Dow Jones industrial average rose 189.20, or 1.5 percent, to 12,570.22. Alcoa gained nearly 6 percent after European regulators approved its $2.7 billion deal to sell its packaging unit to New Zealand company Rank Group. However, Citigroup fell more than 2 percent after a brokerage reduced its earnings outlook for the financial company, predicting it would need to declare more losses related to bad mortgage investments. The broader S&P 500 index rose 18.69, or 1.4 percent, to 1,371.80. The technology-heavy Nasdaq composite index rose 24.13, or 1.05 percent, to 2,327.48. Shares of Genentech jumped 8.4 percent after U.S. regulators approved on Friday the drugmaker's Avastin for the treatment of breast cancer. The New York Stock Exchange composite index rose 145.25 to 9,210.08. The American Stock Exchange composite index rose 28.97 to 2,306.87. And the Russell 2000 index rose 15.03 to 710.46.
