Wall St led higher by banks, insurers

US stocks jumped nearly 2% on Monday as a merger between two big banks in Greece suggested Europe was working through its financial problems and a rebound in consumer spending calmed fears about the US economy.

Insurance company shares were higher after property damage from Hurricane Irene was less than feared, according to early estimates.
Travelers Cos Inc rose 4.7% to USD 50.59, while Allstate Corp jumped 7% to USD 25.93.
Wall Street was also relieved that damage in New York City, especially in lower Manhattan, from Irene was not as bad as feared. The New York Stock Exchange and the Nasdaq opened on schedule, but volumes were expected to be thin.
But trading volume was light at about 1.9 billion shares by late morning as many Wall Street workers were stuck at home with commuter rail and bus lines not operating. The New York City subway system slowly returned to service early Monday after a systemwide shutdown.
Financial stocks were the top gainers after Greece's Alpha and EFG Eurobank banks sealed a megamerger that is expected to trigger more deals to shore up the sector battered by a severe debt crisis and recession.
The S&P financial index was up 2.7% and the KBW Banks index added nearly 2.8%. Bank of America Corp rose 4.6% to USD 8.12 and JPMorgan Chase & Co gained 2.3% to USD 37.03.
Keith Wirtz, chief investment officer at Fifth Third Asset Management, with USD 18 billion in assets, said: "We've actually started putting cash to work. A few things helping the stock market. There's relief coming from the storm and Europe, particularly with Greece."
The Dow Jones industrial average jumped 174.94 points, or 1.55%, at 11,459.48. The Standard & Poor's 500 Index put on 21.37 points, or 1.82%, at 1,198.17. The Nasdaq Composite Index advanced 51.48 points, or 2.08%, at 2,531.33. US consumer spending posted its largest increase in five months in July, data showed, supporting views the economy was not falling back into recession.
Also, July pending home sales fell 1.3%, matching forecasts, but remained higher than year-ago levels.