The Dow Jones industrial average gained 202 points Tuesday, its largest one-day jump this year.
Stock indexes rose after Coca-Cola, IBM and other companies reported better second-quarter earnings. Stocks added to their gains after President Barack Obama praised a proposal by six senators that would raise the country's debt ceiling.
The Dow gained 1.6 percent to close at 12,587.
The S&P 500 rose 21 points or 1.6 percent, to 1,327. That's the broader index's best day since March 3. The Nasdaq gained 61 points, or 2.2 percent, to 2,827.
Four stocks rose for every one that fell on the New York Stock Exchange. Trading volume was below average at 3.9 billion shares.