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Wall Street soars; Dow in positive territory for the year

A broad rally swept through Wall Street Friday as several big companies reported solid earnings and investors expressed optimism that a weekend meeting will bring European leaders closer to easing the continent's debt crisis.

The encouraging corporate news was in line with recent signs that the U.S. economy strengthened in September after a very weak summer. On Friday the government said unemployment fell last month in half of U.S. states and was unchanged in 11. That's much better than in August, when unemployment rose in 26 states.

Among the highlights on Wall Street:

  • The Dow Jones industrial average jumped 267.01 points, or 2.3 percent, to 11,808.79.
  • The Dow is now up 2 percent from where it started 2011. Before Friday's surge, it was down for the year.
  • The Dow has risen for four weeks straight, the first time that has happened since January. It is up 9.63 percent in the four-week span.
  • This is the longest winning streak for the Dow since the period ending Jan. 21.
  • The S&P 500 gained 22.86 points, or 1.9 percent, to 1,238.25. The broader index recorded its first three-week winning streak in eight months. The S&P is up 12.52 percent since Oct. 3.
  • The Nasdaq composite index gained 38.84, or 1.5 percent, to 2,637.

McDonald's Corp., Chipotle Mexican Grill Inc. and Harman International Industries Inc. were among the companies that beat analysts' expectations. The quarterly earnings season is off to a strong start. Of the 118 big companies that reported earnings so far, 75 percent have beaten estimates, according to financial data provider FactSet.

The encouraging corporate news was in line with recent signs that the U.S. economy strengthened in September after a very weak summer. On Friday the government said unemployment fell last month in half of U.S. states and was unchanged in 11. That's much better than in August, when unemployment rose in 26 states.

Markets have been moving sharply in recent weeks, mainly in reaction to the latest headlines out of Europe on the debt crisis. The Dow had a bigger jump on Oct. 10, 330 points, after the leaders of France and Germany pledged to have a comprehensive solution to the debt crisis in place by the end of the month. The Dow has gained 10.8 percent since Oct. 3, when it sank to its lowest point of the year.

European markets closed sharply higher. Germany's DAX index rose 3.5 percent. France's CAC 40 and Italy's FTSE MIB rose 2.8 percent.

Traders sold ultra-safe U.S. Treasury debt as demand for riskier assets rose. The yield on the 10-year Treasury note rose to 2.22 percent from 2.18 percent late Thursday. Bond yields rise as demand for them falls and their prices decline.

Stocks were lifted this week by better news about the U.S. economy. A measure of manufacturing in the Philadelphia region grew in October after contracting for two straight months. The number of people claiming unemployment benefits declined last week, and inflation remains low.

The Associated Press contributed to this report.