Banks led a broad rally in U.S. stocks Tuesday, lifting the market to a milestone-shattering finish.
Gains by industrial stocks, retailers and healthcare companies also helped drive the major stock indexes to record highs.
Investors were encouraged by news that a Senate committee cleared the way for a tax reform bill to go before the full Senate. Financial stocks also got a boost from Federal Reserve chair nominee Jerome H. Powell, who told another Senate committee that the Fed would consider easing up on bank regulations.
Encouraging economic data and the latest batch of company earnings and deal news also helped drive the rally, which gave the Standard & Poor's 500 index its best day since Sept. 11.
“Given seasonal patterns, I expect that we'll see the market strong into year-end,” said Mark Chaikin, founder of Chaikin Analytics.
The S&P 500 index rose 25.62 points, or 1%, to 2,627.04. The Dow Jones industrial average climbed 255.93 points, or 1.1%, to 23,836.71. The Nasdaq composite advanced 33.84 points, or 0.5%, to 6,912.36. The Russell 2000 index of smaller-company stocks jumped 23.12 points, or 1.5%, to 1,536.43.
Gainers outnumbered decliners more than 2 to 1 on the New York Stock Exchange.
Banks and other financial stocks had their best day since March. The sector is up 15.2% this year.
JPMorgan Chase and Bank of America notched their biggest gains since April. JPMorgan rose 3.5% to $101.36. Bank of America climbed 3.9% to $27.64.
Investors also got a double dose of encouraging data on the U.S. economy.
The Conference Board said that its consumer confidence index rose this month to its highest level since November 2000. Economic growth clocked at a healthy 3% annual pace in the third quarter, and the unemployment rate has fallen to a 17-year low of 4.1%.
A separate index showed that in September, U.S. home prices rose at the fastest pace in more than three years, fueled by a record-low supply of homes for sale. Home builder shares rose Tuesday, led by KB Home, which climbed 4.1% to $30.
Corporate deal news also moved the market.
Buffalo Wild Wings jumped 6.3% to $155.60 after it agreed to be acquired by Arby's for $157 a share. Buffalo Wild Wings was at $117.25 a share before reports about a possible deal emerged two weeks ago.
Emerson Electric rose 3.7% to $64.15 after the company withdrew its bid for Rockwell Automation. Rockwell rose 3.2% to $197.13.
Companies with strong quarterly results or outlooks also got a lift.
Thor Industries surged 13.3% to $154.37 after the RV maker reported quarterly earnings that were much higher than analysts expected. Its rival Winnebago Industries climbed 7.8% to $54.60.
Tech Data jumped 10.2% to $102.76 after the information technology products company posted better-than-expected third quarter results and gave strong fourth-quarter forecasts.
Real estate sector companies were the only laggard. Public Storage fell 2.6% to $209.43.
Bond prices rose. The yield on the 10-year Treasury fell to 2.34% from 2.35%.
Benchmark U.S. crude fell 12 cents to settle at $57.99 a barrel. Brent crude, used to price international oils, fell 23 cents to $63.61. Wholesale gasoline fell 2 cents to $1.77 a gallon. Heating oil was little changed at $1.95 a gallon. Natural gas rose 15 cents, or 5%, to $3.07 per 1,000 cubic feet.
Gold inched up 50 cents to $1,294.90 an ounce. Silver fell 20 cents to $16.82 an ounce. Copper fell 6 cents to $3.07 a pound.
The dollar rose to 111.55 yen from 111.01 yen. The euro weakened to $1.1847 from $1.1899.