NEW YORK (CNN/Money) - U.S. stock markets finished sharply higher Monday as solid performances from a host of sectors -- and an absence of bad news -- contributed to a broad-based rally.

The Dow Jones industrial average closed 213.21 points higher at 9,687.42. The Nasdaq composite finished up 48.55 to close at 1,553.29. The Standard & Poor's 500 ended the day 28.90 higher at 1,036.17.

Coming off four straight losing weeks, the indexes sustained strong gains on a rare day with no bad news to knock stocks off their stride. Monday's strong finish combined with a big turnaround on Friday had market watchers pondering what stocks would need to keep the advance going.

Douglas Altabef, managing director at Matrix Asset Advisors said a few days free of bad news on corporate governance or international tension would be needed.

Altabef also said some positive announcements from bellwether companies, such as Oracle (ORCL: up $0.63 to $9.20, Research, Estimates) which reports its latest quarterly earnings Tuesday after the bell, or industry groups would help.

"Hopefully today is an inkling of what could happen as we go into the June quarter reporting period based on real (company) information," said Bill Meade, equity product manager at RBC Capital Markets.

Financial services stocks were the Dow's biggest gainers, with components Citigroup (C: up $2.63 to $42.83, Research, Estimates), American Express (AXP: up $2.24 to $38.20, Research, Estimates) and J.P. Morgan (JPM: up $2.48 to $35.48, Research, Estimates) all moving higher.

David Trone, financial services analyst at Prudential Securities, said the sector is oversold, with shares currently trading at "crisis level" valuations. Trone also said short sellers are nervous about any positive signal brokerages may give in their outlooks this week.

Lehman Brothers (LEH: up $2.81 to $62.65, Research, Estimates), Morgan Stanley (MWD: up $2.77 to $45.12, Research, Estimates) and Goldman Sachs (GS: up $2.49 to $75.34, Research, Estimates) all are scheduled to report fiscal second-quarter earnings this week.

"A lot of [financial companies] report this week," said Charles Payne, CEO of Wall Street Strategies. "This might be some speculation that we'll see some visibility from the group."

Semiconductor stocks bounced back from tough losses last week, with industry leaders Intel (INTC: up $1.28 to $22.56, Research, Estimates) and Advanced Micro Devices (AMD: up $1.20 to $10.80, Research, Estimates) higher.

Kirk Pond, chairman and CEO of Fairchild Semiconductor (FCS: Research, Estimates), told CNNfn's Market Call the recovery of the sector already is under way, with inventories reduced and economies around the world beginning to pick up.

Telecom stocks also got a lift after Qwest Communications (Q: up $0.85 to $5.00, Research, Estimates)' CEO Joseph Nacchio resigned early Monday, as the Wall Street Journal reported that the regional phone carrier's board had become "increasingly frustrated" with the company's regulatory and financial problems. The stock is well off its 52-week high of $32.50.

Wall Street Strategies' Payne said events such as Nacchio's resignation and Saturday's guilty verdict on obstruction of justice charges against auditor Arthur Andersen -- putting some of the Enron mess behind investors -- could be aiding investor sentiment.

"I think investors may be seeing some of the things they want to see," Payne said. "Certainly people paying for the sins of the past are among those things."

As earnings preannouncements geared up, Dow component McDonald's (MCD: up $0.70 to $29.82, Research, Estimates) said it expects second-quarter profit to be 38 or 39 cents per share, higher than the current First Call analyst consensus estimate of 37 cents per share.

Biotech stocks gave strength to the Nasdaq, led by Amgen (AMGN: up $2.52 to $42.70, Research, Estimates), which was upgraded by A.G. Edwards to "buy" from "hold" with a new price target of $46. The Nasdaq biotech index rose 20.59 to 375.34.

Pharmaceutical stocks also did well, helped by Biovail (BVF: up $1.92 to $32.67, Research, Estimates) which announced regulatory approval of a hypertension drug.

European stocks closed higher, with London's FTSE 100 index up 2.7 percent. Asian-Pacific stocks closed lower Monday, as Tokyo's Nikkei index fell 2.7 percent.

Treasury prices were lower, pushing the 10-year note yield up to 4.85 percent. The dollar gained against the yen and euro. Light crude futures rose 20 cents to $26.34 a barrel in New York, while gold fell $1.70 to $318 per ounce.

Market breadth was strongly positive. On the New York Stock Exchange, advancers led decliners nearly 3-to-1 as $1.22 billion shares traded. On the Nasdaq, it was winners over losers more than 2-to-1 as volume reached 1.57 billion shares.

"The interesting thing about today's rally is that it's across the board," said John Zimmerman, director of growth strategies at Banc of America Capital Management. "It's not just short covering, there's money coming into the market today."