Markets closed up today:
▲ Dow: +1.87 percent
▲ Nasdaq: +2.17 percent
▲ S&P: +2.04 percent
▲ Gold: +0.35 percent to $1,700.88 an ounce
▲ Silver: +1.28 percent to settle at $32.61
▼ Oil: -0.96 percent
Market were up:
The last time the stock market was this high, the Great Recession had just started, and stocks were pointed toward a headlong descent.
But on Thursday, the market moved swiftly in the other direction. The Dow Jones industrial average hit its highest mark since December 2007, and the Standard & Poor's 500 index soared to its highest level since January 2008 in a rally that seemed destined to mark a milestone: American stocks have come almost all the way back.
A long-anticipated plan to support struggling countries in the European Union provided the necessary jolt, and the gains were extraordinarily broad. All but 13 stocks in the S&P index were up. European markets surged, too.
Thursday's rally got momentum after the president of the European Central Bank unveiled a new program to buy government bonds from the region's struggling countries with the aim of lowering their borrowing costs. Mario Draghi said the program will have no set limit on how much it can buy.
That was just what investors needed to hear. The S&P 500 index jumped 28.68 points to 1,432.12. The Dow Jones industrial average surged 244.52 points to 13,292.
The Nasdaq composite index also reach a milestone, gaining 66.54 points to close at 3,135.81, its highest level in 12 years.
Germany's DAX and France's CAC-40 each rallied 3 percent. The gains were even bigger in Spain and Italy, the two largest countries to become caught up in the region's long-running government debt crisis. Spain's benchmark index soared 5 percent, Italy's 4 percent.
Traders shifted money out of U.S. Treasury bonds, considered one of the world's safest places to stash money, and the drop in demand lifted yields. The yield on the 10-year Treasury note rose to 1.67 percent, up from 1.60 percent late Wednesday.
Although stocks have rebounded, the broader economy is still lagging. Could the rally help President Obama?
A number of recent studies have connected a rising stock market to improved odds of re-election for the incumbent president. Since 1900, when the S&P 500 has posted gains from July to October in an election year, voters returned the sitting president to the White House 80 percent of the time, according to a study by S&P Capital IQ.
But no modern president has faced re-election when unemployment was so high. President Jimmy Carter was bounced from office in 1980 when unemployment was 7.5 percent.
The U.S. economy grew a tepid 1.7 percent in the April-June period, less than half the pace of late last year. Big overseas economies, like Brazil's and China's, are slowing. And many countries in the 17-nation eurozone are in recession.
On Thursday, the chief economist of the Organization of Economic Cooperation and Development said he expects even powerhouse Germany to fall into recession by the end of the year.
As if that's not bad enough, the dollar has strengthened against major currencies recently. That makes U.S. products sold in foreign currencies more expensive, cutting into overseas revenue.
Still, Barry Knapp, head of U.S. equity strategy at Barclays Capital, said stocks tend to anticipate the future economy rather than reflecting current conditions. So we'll just have to wait and see what, if any, effect this rally has on the election.
The Associated Press contributed to this report.