NEW YORK (AP) — A strong start to the U.S. shopping season and fresh proposals for a far-reaching solution to Europe’s debt crisis sent stocks sharply higher Monday. The Dow Jones industrial average soared 300 points in afternoon trading, making up more than half of the ground it lost last week.
Initial reports show a record number of shoppers hit the mall or bought gifts online during the holiday weekend. Thanksgiving weekend is a make-or-break time for many retailers. For the past six years, Black Friday has been the biggest sales day of the year.
The retail numbers add to a growing set of indicators, including steady drops in the number of applications for unemployment, that suggest the U.S. is far from the second recession economists had begun to fear in August.
“This goes in stark contrast to the gloom and doom that had been over markets,” said Rob Lutts, president of Salem, Ma.-based investment firm Cabot Money Management. “A lot of the stocks I follow have been more oversold than any time I can remember in the last few years.”
Markets in Europe also rose sharply as leaders there discuss new approaches for containing the region’s debt troubles. One plan calls for Europe’s most stable economies jointly sell bonds to provide assistance to the region’s most indebted members, like Greece and Portugal.
Investors are hoping that the recent signs of deterioration in the debt crisis will finally get Europe’s leaders to agree on a package of measures that can ease market concerns over whether the euro currency itself can survive.
Stock indexes in Italy, Germany and France rose more than 4 percent. The euro and commodities prices also rose. The yield on the 10-year Treasury note rose to 2.03 percent from 1.97 percent late Friday as investors sold ultrasafe assets.
The Dow jumped 310 points, or 2.8 percent, to 11,541 as of 1:30 p.m. Eastern. The index plunged 564 points last week on fear that Europe’s debt crisis was spreading to large countries like Spain and even Germany. Alcoa Inc. jumped 5.7 percent, the most of the 30 stocks in the Dow.