Budget talks push the market higher

The Dow Jones industrial average rose 100.38 points, or 0.76 percent, to 13,235.39. The S&P 500 Index gained 16.81 points, or 1.19 percent, to 1,430.39 its highest closing level since Oct. 22.

 The NASDAQ Composite added 39.27 points, or 1.32 percent, to 3,010.60. 

Ten-year Treasury yields increased seven basis points to 1.77 percent. Gold increased, while sugar, natural gas, coffee, cotton and oil led gains in commodities.

The sentiment on the street was optimistic on report of movement and improvement on the fiscal cliff negotiations.

President Barack Obama and House speaker John Boehner met at the white house on Monday raising hopes of a deal in sight. John Boehner has dropped his opposition to raising tax rates for some top earners. President Obama’s proposal also highlights some spending cuts and a revise tax increase. President Obama’s new tax increase will affect people making 400K and above which is well above his earlier 250K. President Obama is also considering a possible budget concession on Social Security cost-of-living increases. The two met for about 45 minutes at the White House today with two weeks remaining to avoid the so-called fiscal cliff.

Currently, the market is being held hostage by the fiscal cliff talks. The market gas been reacting for the past few weeks to rumors on the different proposals submitted by both parties.

Stocks have been on a rollercoaster ride, the sentiment on the street is very unsettled and volatile.  

Investors are fretting about a possibility of a recession in case the talks on the fiscal cliff fail.

In the meantime, Clearwire agreed to sell the rest of the company to Sprint Nextel for $2.2 billion. Clearwire stock price tumbled 12.8 percent to $2.94, while Sprint was down 0.7 percent to $5.51. 

Apple which have suffered a setback the past weeks, have rebounded on report of strong sales of the I phone 5 in China.

The sentiment on the street is very auspicious on a potential by the end of the week or early next week.