U.S. stocks bounced back sharply Tuesday from Monday's heavy selling, with the S&P 500 setting another record high, as Ukraine tensions subsided.
The Dow Jones Industrial Average surged 227.73 points, or 1.41 percent, to 16,395.76. The S&P 500 jumped 28.18 points, or 1.53 percent, to 1,873.91, a fresh record closing high. The Nasdaq Composite Index soared 74.67 points, or 1.75 percent, to 4,351.97.
The broader S&P 500 also set a new all-time intraday high of 1, 876.23.
On the previous trading day, U.S. stocks saw selloff with global stocks on intensifying situation in Ukraine as U.S. President Barack Obama warned Monday that his administration is examining "a whole series of" economic and diplomatic steps to " isolate" Russia over its refusal to withdraw military forces from the Ukrainian republic of Crimea.
On Tuesday, the Kremlin said Russian President Vladimir Putin has ordered forces engaged in military drills to return to their permanent bases.
Global stocks interpreted the move as a cheerful sign and reacted positively. Asian shares ended mostly higher overnight, while European shares also posted a sharp relief rally Tuesday, almost wiping out all losses Monday.
In response to the positive sign, Wall Street followed suit to leap, as investors took Monday's dip as a buying opportunity, still optimistic with the U.S. equity market.
Adding to bullish sentiment in the market, Jeremy Siegel, professor of Finance at the Wharton School of the University of Pennsylvania, predicted in an interview with CNBC Tuesday that the Dow will rise to 18,000 points, representing roughly a 10 percent gain compared with its current level, citing growing corporate earnings.
"It could get there by the year-end, it could get there sooner, it might be later," the professor said, adding his fair market value estimate for the S&P 500 is 2,000.
With no major economic data due out in the day, investors are looking ahead to the closely-watched nonfarm payrolls report for February scheduled for release on Friday by the U.S. Labor Department.
The CBOE Volatility Index, widely considered as a fear gauge of the market, tumbled 11.87 percent to 14.10.
In other markets, oil prices retreated Tuesday amid the speculation that tensions between Ukraine and Russia will not disrupt oil supplies.
Light, sweet crude for April delivery moved down 1.59 dollars to settle at 103.33 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for April delivery lost 1.9 dollars to close at 109.3 dollars a barrel.
Gold futures on the COMEX division of the New York Mercantile Exchange pulled back on decreasing tensions over Ukraine Tuesday, with the most active gold contract for April delivery down 12.4 dollars to settle at 1,337.9 dollars per ounce.
The U.S. dollar traded mixed against major currencies on Tuesday and it rallied versus the Japanese yen on relieved Ukraine tensions.
In late New York trading, the euro traded at 1.3734 dollars, the same as in the previous session, and the dollar bought 102.26 yen, higher than 101.43 yen of the previous session.
