Dow flirts with 11,000

NEW YORK (CNNMoney.com) -- Stocks rallied Monday, with the Dow edging closer to 11,000, as investors returning from a long weekend welcomed last week's jobs report, the morning's strong housing market report and the launch of Apple's iPad device.

The market also kept an eye on the 10-year Treasury note yield, which surged to 4% as investors dumped treasuries in favor of riskier assets. Oil prices surged to nearly 18-month highs. The dollar was mixed versus other major currencies.

The Dow Jones industrial average (INDU) added 46 points, or 0.4%, to close at 10,973.55. Earlier, the Dow rose to within 11 points of 11,000, a key psychological level. The Dow last closed above 11,000 on Sept. 26, 2008, ending at 11,143.13.

The S&P 500 index (SPX) gained 9 points, or 0.8% closing at its highest point since Sept. 26, 2008, when it topped 1200. The Nasdaq composite (COMP) added 27 points, or 1.1%, closing at its highest point since Aug. 15, 2008.

Stocks gained last week, rising for the sixth of seven weeks. But markets were closed for Good Friday, making Monday the first time investors were able to react to Friday's big jobs report from the Department of Labor.

Monday also was the first chance for investors to react to the strong sales for Apple's iPad tablet computer, which launched Saturday amid much enthusiasm.

There were also positive reports on housing and on the services sector.

"The pending home sales report shows a stable housing environment and the services sector report was a consistent follow-through to last week's manufacturing report," said Scott Anderson, chief economist at Wells Fargo.

"Following the jobs report, growth looks pretty solid," he said. "It suggests we can avoid a double-dip recession."

Jobs: Employers added 162,000 jobs to their payrolls in March, more than in any month in the last three years, the government said Friday.

Economists surveyed by Briefing.com were expecting an even bigger gain, of 184,000 jobs. However, the report was not considered disappointing as it showed growth even when accounting for temporary employment and the impact of 48,000 once-in-a-decade census jobs.

Employers cut 14,000 jobs in February.

The unemployment rate, generated by a separate survey, held steady at 9.7% as expected.

Apple: The tech leader said it sold 300,000 of its iPad tablet computers on Saturday and that users downloaded over one million apps from the company's App store and over 250,000 ebooks from its iBookstore. Shares of Apple (AAPL, Fortune 500) gained 1% Monday.

Economy: The pending home sales index posted a surprise jump in February, rising 8.2% to 97.6 from a revised 90.2 in January. Economists expected the report from the National Association of Realtors to have declined by 1%, according to Briefing.com forecasts.

A separate report showed growth in the services sector of the economy. The Institute for Supply Management's (ISM) services sector index rose to 55.4 in March from 50 in February, versus forecasts for a rise to 53.6. Any reading over 50 indicates expansion in the sector.

Bonds: Treasury prices tumbled, raising the yield on the 10-year note to 4% from 3.86% Friday. Treasury prices and yields move in opposite directions.

In the afternoon, the government saw a strong response to its auction of $8 billion in 10-year Treasury Inflation Protected Securities (TIPS), with bidders offering to buy 3.43 times the amount of debt sold, up from the recent average. Indirect bidders, which include foreign central banks, bought 37.5% of the sale.

A January offering of $10 billion in 10-year TIPS saw bidders offering to buy 2.65 times the amount of debt sold with a 40.7% indirect bidder rate.

Treasury is auctioning $82 billion in debt this week.

The dollar and commodities: The dollar fell versus the euro and yen.

COMEX gold for June delivery rose $7.70 to $1,133.80 per ounce.

U.S. light crude oil for May delivery rose $1.75 to settle at $86.62 a barrel on the New York Mercantile Exchange, the highest close for crude since October 2008.

World markets: In overseas trading, European markets rallied. Asian markets ended higher as well.

Market breadth was positive. On the New York Stock Exchange, winners topped losers by three to one on volume of 906 million shares. On the Nasdaq, advancers beat decliners by almost three to one on volume of 2.05 billion shares.