Wall Street report: Monday close

MARKETS climbed to levels last seen in early July as investors returned from a summer weekend in a sunnier frame of mind. Sentiment was helped by better-than-expected figures from retailer

The Dow Jones Industrial Average vaulted 212.73 points or 2.4% to 8990.79, while the Nasdaq surged 33.68 points or 2.5% to 1394.69.

One analyst said investors were more willing to accept a 'glass half full over a glass half empty' point of view than they were a month ago. 'Now we've passed through the corporate governance and certification issues, the focus is more and more on how companies are performing,' he said. 'And the evidence is not as bad as some people feared and there are even hints that the economy might by steadying.'

The only major economic figures out came from the Conference Board, the independent economic research organisation in New York. Its index of leading indicators showed a 0.4% decline in July, the biggest drop since September. But economists said a major driver behind the decline was a sagging stock market and that shares had picked up since the data was compiled.

A narrower-than-expected quarterly loss at Toys R Us, the world's biggest toy chain, helped lift its shares $1.08 or 8% to $13.90. Lowe's jumped $4.21 or 11% to $41 after it outstripped forecasts with its latest results. Other retailers strengthened on the news.

Wal-Mart added 90 cents or 1.7% to $54.69. Lowe's rival Home Depot strengthened 93 cents or 3.3% to $29.03.

Software makers benefited from the positive tone. Microsoft was marked up $2 or 4% to $52 and Oracle gained 43 cents or 4% to $10.82. Switch maker Cisco Systems firmed 54 cents or 5% to $10.93. IBM tacked on $3.14 or 4% to $82.49.

Financial services shares found support possibly on the theory that the credit picture is not as dark as previously portrayed. Citigroup moved up $1.45 or 4.2% to $36.35 and JP Morgan galloped ahead $2.35 or 9.5% to $27.21.

Buyers emerged for companies beaten down over recent accounting issues. Tyco International recouped $1.20 or 9% to $14.50, AOL Time Warner rose 77 cents or 6% to $13.33 and Bristol-Myers Squibb improved 84 cents or 4% to $23.82. Energy company Dynegy soared 60 cents or 36% to $2.29 after it bolstered its finances with the sale of a gas pipeline.