S&P Posts Best Day This Year

By MATT JARZEMSKY

NEW YORK—The Standard & Poor's 500-stock index posted its biggest daily gain of the year, an exclamation mark on stocks' best June in more than a decade, as investors cheered European leaders' progress on the region's debt problems.

Stocks headed toward their best June in more than a decade after European leaders at a summit in Brussels made more progress than investors expected in addressing the region's debt crisis. Paul Vigna has details on The News Hub. Photo: AP.

The index jumped 33.12 points, or 2.5%, to 1362.16, the biggest percentage increase since December. Industrials and technology shares paced gains as all 10 of the benchmark's sectors rose. Nevertheless, stocks remained firmly lower for the second quarter, which ended Friday, due to a plunge in May.

The Dow Jones Industrial Average jumped 277.83 points, or 2.2%, to 12,880.09. The Nasdaq Composite rose 85.56 points, or 3%, to 2935.05.

"It's all Europe. The steps that are being taken now seem to be a little more dramatic and important, and they've acted a little more rapidly than in the past," said Mike Gibbs, co-head of the equity advisory group at Raymond James Financial, which oversees $370 billion in client assets.

European leaders at a two-day summit in Brussels said they would speed plans to create a single supervisor for the euro zone's banks. They agreed that the euro zone's bailout funds should be able to directly boost the capital of struggling banks, without adding to government debt. Investors had taken a skeptical view ahead of the event, leading stocks to decline early this week.

"It's a reminder of how little people expect coming out of any of these summits," said Andres Garcia-Amaya, global market strategist at J.P. Morgan Funds.

"This begins the road map to creating a pan-European banking union by year end," Mr. Garcia-Amaya said. "It gets you closer to that integration that you want to see within Europe, so that's big, but it's just words for now. We need to see the details."

The U.S. rally followed similar action overseas. European shares soared as Spanish and Italian government bond yields fell. The Stoxx 600 Europe index advanced 2.7%, while Spain's IBEX 35 index gained 5.7%.

Asian stocks also bolted higher at the sight of the summit headlines with the Hang Seng adding 2.2%, while the Nikkei tacked on 1.5%.

The gains capped the first down quarter in three for U.S. stocks. The Dow Jones Industrial Average fell 2.5% this quarter, while the S&P 500 retreated 3.3%.

Friday brought mixed readings on the U.S. economy. The Institute for Supply Management-Chicago's business barometer, a survey of Chicago-area purchasing managers, unexpectedly ticked up to 52.9 from 52.7.

But the University of Michigan's June consumer-sentiment gauge fell more than expected.

Meanwhile, consumer spending was unchanged in May, failing to increase for the first time in six months, even as income ticked up 0.2%. The data matched economists' expectations.

The core price index for personal-consumption expenditures, which excludes volatile food and energy prices, edged up less than expected in May.

Crude-oil futures jumped 9.4% to settle at $84.96 a barrel, the biggest one-day percent increase since March 2009. Gold futures jumped 3.5% to settle at $1603.50. The U.S. dollar eased slid against the euro but rose versus the Japanese yen.

In the corporate arena, Constellation Brands surged 24%, the biggest climb in the S&P 500, after agreeing to buy out the rest of a joint venture that imports and markets Grupo Modelo beer brands such as Corona Extra, the best-selling imported beer in the U.S. All 30 Dow components traded higher.

Research In Motion plunged 19% after the BlackBerry maker announced its first quarterly operating loss in more than seven years. The company also said it plans to cut about 5,000 jobs—about one-third of its workforce—by the end of the fiscal year.

Nike slumped 9.4% after the athletic-apparel maker reported worse-than-expected quarterly results and warned of slower growth in China.

Ford Motor slipped 5% after warning it expects to lose roughly $570 million in its overseas operations in the second quarter, largely because of Europe's slumping economy. The auto maker expects overall second-quarter profit to decline from the year-earlier period.

ServiceNow, a provider of cloud computing services for businesses, jumped 37% after its initial public offering on the New York Stock Exchange priced higher than expected.

Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com

A version of this article appeared June 30, 2012, on page B4 in the U.S. edition of The Wall Street Journal, with the headline: This June Was a Boon, Not a Swoon.