Led by soaring energy stocks, the Dow jumped more than 400 points Monday as Federal Reserve Chairman Ben Bernanke threw his weight behind a second economic stimulus package and signs of thawing credit markets continue to emerge. 

Today's Market

The Dow Jones Industrial Average jumped 413.21 points, or 4.67%, to 9265.43, the broader S&P 500 added 44.85 points, or 4.77%, to 985.40 and the Nasdaq Composite picked up 58.74 points, or 3.43%, to 1770.03. The consumer-friendly FOX 50 rose 32.49 points, or 4.57%, to 743.15.

Monday's rally came without the dramatic swings that have characterized the stock market over the past several weeks. Instead, the markets stayed in the green the entire day, finishing at session highs. 

“I think it’s a market reaction to being so oversold over the past several weeks," said Kenny Polcari, managing director of ICAP Equities. "Today actually we haven’t had those wild swings, which is very positive. [The market] seems to be settling down instead of the schizophrenia" of the past few weeks.

That volatility was most obvious last week, when the Dow regularly swung in triple-digit gains and losses. Still, last week was the blue-chip index's best weekly performance since March 2003, soaring 401 points. 

“I think a lot of people did their homework over the weekend. They are looking at some of the stocks that were …thrown out with the bath water in some cases," James Maguire of Christopher J. Forbes told FOX Business. 

It's worth noting that Monday's rally came on relatively light volume of about 1.2 billion shares on the New York Stock Exchange, compared to a typical day's volume of 1.6 billion. 

Energy titans ExxonMobil (XOM) and Chevron (CVX) led the way up on the Dow on Monday, soaring double-digit percentages. All 30 stocks on the index ended the day at least 1% higher, with big gains also coming from drug maker Merck (MRK) and Disney (DIS).

The Nasdaq Composite saw more modest gains than the broader market on earnings concerns but still jumped more than 3%. Steel Dynamics (STLD) and Juniper Networks (JNPR) saw double-digit percentage increases to lead the Nasdaq 100 on Monday. Big-name tech giants like Oracle (ORCL) and Cisco (CSCO) also rose sharply, offsetting steep declines from BlackBerry maker Research in Motion (RIMM) and SanDisk (SNDK). 

Stimulated Markets

Stocks picked up steam Monday after Bernanke signaled his support for a second economic stimulus package. 

"With the economy likely to be weak for several quarters, and with some risk of a protracted slowdown, consideration of a fiscal package by the Congress at this juncture seems appropriate," said Bernanke. 

Following Bernanke's comments to lawmakers on Capitol Hill, the White House said it is open to the idea of a second stimulus package -- depending on the details of the plans laid out by Congress. Democratic lawmakers have already been pushing for another stimulus bill.

Asked if the U.S. economy is already in a recession, Bernanke said: "We are in a serious slowdown for the economy... whether it is called a recession or not is of no consequence."

Credit Markets in Focus

The markets were also given a boost by new proof that the credit markets have begun to unlock. 

“I think we’re starting to see at least some evidence of thawing in the short-term lending situation," said Paul Nolte, director of investment at Hinsdale Associates, pointing to Libor rates and the commercial-paper market. “These are things that individual investors had never heard of before but are now watching like hawks.”

The London interbank offered rate, or Libor, declined by 0.36% on Monday -- the sixth straight daily decline and largest since January. Higher Libor rates indicate an unwillingness for banks to lend to each other.

Governments in Europe continued their efforts over the weekend to ease credit markets, led by a $13.4 billion bailout of insurance and banking giant ING Groep (ING). The news sent shares of ING soaring. 

The rescue helped push European markets broadly higher. London's benchmark index closed up 5.4% while France's stock market rose 3.6%. Asian markets also soared overnight on fresh government intervention there. Japan's Nikkei 225 Index jumped 3.6% while Hong Kong's Hang Seng gained 5.28%. 

Energy Stocks Soar

Thanks to a rebound in crude oil prices, energy stocks carried the market higher on Monday, jumping 11% as a sector. Energy names like Hess (HES) and BP (BP) saw even steeper percentage increases. The sector has been hammered by recession fears, losing more than one-third of its value over the past month alone. 

Crude traded higher on hopes OPEC will cut production to fight plunging oil prices. Oil ended up $2.40 to $74.25 a barrel. 

Oil closed lower for the third consecutive week on Friday, diving 7.5% over the five-day span. Crude is now off by about 50% from its all-time records of $147 a barrel. 

Corporate Movers

General Motors (GM) and privately-held Chrysler LLC have been unable to convince lenders to provide necessary financing for a merger that could create cost savings of up to $10 billion, The Wall Street Journal reported. The two auto makers have turned to the government for financial assistance to seal the deal they hope will be inked before the election, the USA Today reported. 

Exelon (EXC) unveiled an all-stock deal worth $6.2 billion to acquire power generator NRG Energy (NRG). The transaction, which puts a 37% premium on NRG’s closing stock on Friday, would create the nation’s largest power company by assets. NRG, which failed to acquire Calpine (CPN) earlier this year, said it is reviewing the offer.

Yahoo! (YHOO) could announce major cost-cutting moves, including job cuts, as soon as Tuesday when it reports quarterly results, The Journal reported. It’s not clear how many jobs Yahoo! will eliminate but the Journal reported it will likely exceed the 1,000 jobs already announced in January.

American Express (AXP) is scheduled to report third-quarter earnings Monday after the close of regular trading. Analysts polled by Thomson Reuters expect the credit card giant and Dow component to post a 30% decline in earnings to 59 cents per share.

Circuit City (CC) is considering closing at least 150 stores and cutting thousands of jobs to avoid filing for bankruptcy protection, according to a report in The Journal. The struggling electronics retailer is also reportedly considering liquidating hundreds of millions of dollars of inventory to help pay its real-estate costs. 

Halliburton (HAL) beat the Street with an adjusted-profit of 76 cents in the third quarter on a 23.5% jump in revenue to $4.85 billion. Analysts expected earnings of 73 cents a share. Including one-time items the energy company posted a loss of 2 cents per share. 

Mattel (MAT), the nation's largest toy maker, said it earned 66 cents a share in the third quarter, up from 61 cents from a year ago. That was short of analyst expectations of 71 cents a share, according to Thomson Reuters.

Hasbro (HAS) posted third-quarter earnings of 89 cents a share, exceeding analyst expectations. The No. 2 U.S. toy maker said its revenue rose to $1.3 billion. Analysts were expecting earnings of 86 cents a share. 

Data Dump

On the economic front, the Conference Board's index of leading indicators unexpectedly rose in September for the first time in five months. The private research group's index increased 0.3%, compared to the 0.2% fall economists had forecasted.