The Standard & Poor's 500 Index jumped 4 percent from its low to its high today, or almost twice the average gap in 2008. The measure gain 1.2 percent to 957.76 at 12:51 p.m. in New York as traders grappled with billionaire investor Warren Buffett's advice to buy shares and reports showing the housing slump and consumer confidence worsened.
The Dow Jones Industrial Average rose 80.20, or 0.9 percent, to 9,059.45. The Nasdaq Composite Index climbed 25.69, or 1.5 percent, to 1,743.84.
Owners of the contracts on stocks, indexes and exchange- traded funds have until today's close to take advantage of the rights granted by their calls and puts. Investors are preparing for the possibility that market makers will boost volatility by buying and selling stock to hedge the risk of the option trades they have facilitated.
The S&P 500 moved more than 1 percent in 10 of the 12 trading sessions in October, or 83 percent of the time, amid concern the global economy will enter a recession. That puts the benchmark index for U.S. stocks on track for the biggest swings since November 1929, when gains or losses of at least 1 percent occurred 88 percent of the time, according to S&P analyst Howard Silverblatt.
The most widely owned S&P 500 options expiring this week are October 1,150 puts. The S&P 500's 18 percent retreat from that strike price profited buyers of those contracts, which increased almost sixfold in value this month. Even after yesterday's 4.3 percent surge, the index has slumped 22 percent in three weeks.
Canadian stocks rose, as energy companies led the main index toward its first weekly gain since Sept. 19 after oil prices climbed from a 13-month low. The Standard & Poor's/TSX Composite Index climbed 364.27, or 39.93 percent, to 9,634.24 at 12:51 p.m. in Toronto.
Brazilian stocks rose. The Bovespa index climbed 1,176 or 3.23 percent, to 37,617.39 at 12:52 p.m. New York time.
European stocks rose, with the Dow Jones Stoxx 600 Index rebounding from its steepest two-day retreat since 1987, on better-than-estimated earnings from Google Inc. and Sony Ericsson Mobile Communications Ltd. and lower money-market rates.
National benchmark indexes gained in all 18 western European markets except Austria, Greece and Iceland. The U.K.'s FTSE 100 added 5.22 percent, and France's CAC 40 rose 4.68 percent. Germany's DAX increased 3.43 percent.
Japanese stocks rebounded from their worst plunge in two decades as the deepening financial crisis prompted investors to buy companies whose earnings are insulated from a slowdown in overseas markets. The Nikkei 225 Stock Average climbed 235.37, or 2.8 percent, to close at 8,693.82 in Tokyo.
Australian stocks fell as mining companies fell. The S&P/ASX 200 Index dropped 42.60 points, or 1.1 percent, to 3,970.80 at the close in Sydney.
Indian stocks fell, with the benchmark Sensitive Index declining to its lowest in more than two years on speculation that overseas funds faced with redemptions are selling the nation's equities. The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 606.14, or 5.7 percent, to 9,975.35, its lowest since June 20, 2006.
China's stocks rose for the first time in four days after the regulator said it would take measures to stabilize the country's financial markets. The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, rose 12.36, or 0.7 percent, to 1,833.26 at the close, snapping a three-day, 8.3 percent retreat.
Russian stocks fell after Finance Alexei Kudrin predicted further declines for the country's equities market because of the global credit crisis. he ruble-denominated Micex Index sank 4.34 percent to 599.64 after earlier advancing as much as 6.4 percent.