The stock market had its best day since mid-August, and the major indexes closed above the 50-day moving average for the first time in nearly five weeks.
XIndexes closed near session highs and within striking distance of new highs.
The Nasdaq composite led with a 1.8% increase, the best since Aug. 13. The S&P 500 added 1.3% and the Dow Jones Industrial Average climbed 1.4%. All three indexes closed above their 50-day lines, beating a pesky level of resistance that had restricted the stock market for about a month.
Volume rose from Wednesday's levels, according to unconfirmed data. Advancing stocks led decliners by a 2-1 ratio on the NYSE and by nearly 3-to-1 on the Nasdaq. This data indicated that institutional investors were gladly paying up for shares, a good sign for the market.
Investors applauded news that U.S. and Chinese negotiators made plans to renew talks in early October. Chinese stocks rallied broadly. The iShares China Large-Cap ETF (FXI) jumped 1.2%.
Trade-sensitive sectors fared best. The SPDR S&P Retail ETF (XRT) surged 3.7% and made it back to its still-weakening 50-day line. IShares PHLX Semiconductor (SOXX) rallied 3.1%. Energy stocks also climbed, even as U.S. crude prices were nearly unchanged.
Risk-On Assets Lift Stock Market
All manner of higher-risk and cyclical assets made strong strides. The small-cap Russell 2000 leapt 1.7%, while the Dow transports jumped 2.6%.
Bonds rallied, sending the yield on the 10-year Treasury note down 11 basis points to 1.56%.
Gold miners, utilities and real estate stocks were lower. Those sectors acted as a buffer while the main indexes wallowed below the 50-day averages.
Innovator IBD 50 ETF (FFTY) rose 1.1% as several leading stocks broke out of bases. Copart (CPRT) cleared a flat base with a 79.84 buy point after the company beat profit expectations. On Leaderboard, Copart went from the watch list to the Leaders list.
Universal Display (OLED) broke out of another flat base in heavy trading. Visa (V), which was analyzed in IBD 50 Stocks To Watch Tuesday, rose above the 184.17 buy point of a flat base.
New Oriental Education (EDU) regained a 110 buy point after several days of shaky action. Comcast (CMCSA) followed through on a breakout past a 45.40 entry.
Juan Carlos Arancibia is the markets editor of IBD and oversees market coverage. Follow him at @IBD_jarancibia
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