The weak dollar also helped, lifting commodity shares and the stocks of companies that do a lot of business overseas.

The Dow Jones industrial average (INDU) rose 30 points, or 0.3%, closing at the highest point since Oct. 1, 2008.

The S&P 500 index (SPX) gained 8 points, or 0.7%, closing at the highest point since Oct. 2, 2008. The Nasdaq composite (COMP) rose 22 points, or 1%, closing at the highest point since Sept. 19, 2008.

After propelling the market off of 12-year lows hit in March, the S&P 500 has risen 64% as of Friday's close.

"The market has shown some extraordinary strength here, but I think we're moving into a period of greater volatility," said Don DeWaay, CEO at DeWaay Capital Management.

"This market is running a lot more on emotion now, rather than fundamentals," he said.

The Dow closed at a 14-month high Friday after better-than-expected reports on retail sales and consumer sentiment, but broader gains were limited by tech weakness and a strong dollar.

Citigroup: Citigroup said Monday that it will return $20 billion in bailout money to the government through a combination of stock and debt offerings.

Citigroup (C, Fortune 500) said the bulk of the payment will be funded through a $17 billion common stock offering. The company also said Treasury will sell up to $5 billion of the $25 billion in Citigroup common stock it holds shortly, and sell the rest of it over the next year.

Obama: President Obama met Monday with top executives of some of the nation's biggest banks, including JPMorgan Chase (JPM, Fortune 500), Bank of America (BAC, Fortune 500) and Wells Fargo (WFC, Fortune 500).

He said his main message to bankers was that banks received extraordinary assistance during the crisis, and now that the industry is back on its feet, it needs to reciprocate. He is expected to urge bankers to provide greater lending, cut back on bonuses and support financial reform efforts.

Exxon-XTO deal: Dow component Exxon Mobil (XOM, Fortune 500) said it will buy XTO Energy (XTO, Fortune 500) in a $41 billion stock and debt deal that values XTO shares at a 25% premium to its Friday closing price. The deal also includes the assumption of $10 billion in debt.

Exxon shares fell 4% and limited any gains on the Dow. XTO shares rallied 17%.

Dubai: Worries that Dubai might default on billions of dollars in debt rattled world markets at the end of last month. But some of those fears have eased over the last few weeks on signs that any fallout will be limited.

Fears were further soothed Monday after the city-state received $10 billion in financing from Abu Dhabi, another of the United Arab Emirates.

World markets: Overseas markets gained. In Europe, London's FTSE 100 rose 1%, the German DAX rose 0.8% and France's CAC 40 rose 0.7%. Asian markets rose, with the exception of Japan's Nikkei, which was little changed.

Dollar: The dollar slipped versus the euro and the yen, turning lower after the recent rally.

A weak dollar has added to the more than nine-month-old stock rally over the past nine months, giving a boost to dollar-traded commodities, as well as commodity shares and the stocks of companies that do business overseas. But so far in December, the dollar has been mixed or stronger, putting some pressure on stocks.

Commodities: The weak dollar gave a lift to dollar-traded commodities. COMEX gold for February delivery rose $3.90 to settle at $1,123.80 an ounce. Gold closed at an all-time high of $1,218.30 an ounce earlier this month.

U.S. light crude oil for January delivery fell 36 cents to settle at $69.51 a barrel on the New York Mercantile Exchange.

Bonds: Treasury prices were little changed, with the yield on the 10-year note standing at 3.55%, unchanged from late Friday. Treasury prices and yields move in opposite directions.

Market breadth was positive. On the New York Stock Exchange, winners topped losers roughly three to one on volume of 1.08 billion shares. On the Nasdaq, advancers beat decliners two to one on volume of 1.86 billion shares. 

NEW YORK (CNNMoney.com) -- Wall Street has finally gotten the piece of economic news it has been waiting for: the battered labor market may be starting to heal. But with major stock gauges at their highest levels in more than a year, recovery bets could already be baked into the cake.

The week ahead brings a modest array of economic reports. Highlights include readings on retail sales, consumer sentiment and the trade gap. President Obama and Federal Reserve Chairman Ben Bernanke are among the speakers on tap. But none of these events are likely to change the markets' direction much.

Through the end of 2009 and the first quarter of 2010, stocks are bound to stick to a narrow range, as investors hold onto gains off March lows and seek the next catalyst, said Jamie Cox, managing partner at Harris Financial Group.

"The broad averages are probably going to go sideways and for a while," Cox said. "It's not going to be as hard or as easy as it's been in the last 24 months, where everything rose, everything fell, then everything rose again. The next few months are going to be stock by stock."

Jobs report lifts spirits: Employers cut 11,000 jobs from their payrolls last month, the Labor Department reported Friday. It was the smallest number of job losses since the start of the recession in December 2007. The unemployment rate, generated by a separate survey, fell to 10% from a 26-year high of 10.2% in October.

Job losses from the previous two months were revised lower too, indicating that a slow but steady pattern of lessening job cuts is emerging. But the drop in the unemployment rate is also points to the millions of people who have been out of work so long that they've given up looking for a job.

"It's going to be years until we get back to where we were in 2007, but this report is a clear sign that the labor market is improving," said Phil Orlando, chief equity market strategist at Federated Investors.

Bets that the recession was ending -- combined with substantial fiscal and monetary stimulus -- drove stocks higher over the last 9 months. The Dow (INDU) has risen 59% as of Friday's close since bottoming at a 12-year low on March 9.

Following the release of Friday's jobs report, the blue-chip average and the S&P 500 (SPX) both hit 14-month highs, touching levels not seen since just after the collapse of Lehman Brothers last year. The Nasdaq (COMP) is also near 14-month levels.

While the gains off the lows have been tremendous, most investors have still not recovered the bulk of what they lost in the slow market crash of 2008 through early 2009. The wish to recover more of what was lost -- and the need to put to work the trillions still sitting in cash or other low-yielding holdings -- should give stocks a continued upward bias, the analysts said.

But at the very least it's likely to be much more slow going than it was for most of this year, even with signs of the labor market starting to recover.

"It's going to be a slow slog for the labor market, but I think stocks can continue to grind higher from here," said Orlando.

On the docket

Monday: Fed Chairman Ben Bernanke speaks about the economic outlook and Fed policy at the Economic Club of Washington in the early afternoon.

Fed Vice-Chairman William Dudley speaks in the late afternoon.

A report on October consumer credit is also due in the afternoon, but it's not usually a market mover.

Tuesday: President Obama speaks about the economy at the Brookings Institution in Washington.

Intel (INTC, Fortune 500), Microsoft (MSFT, Fortune 500) and Netflix (NFLX) are among the companies due to attend Barclays Technology conference in San Francisco.

JPMorgan Chase (JPM, Fortune 500), MasterCard (MA, Fortune 500) and Regions Financial (RF, Fortune 500) are among the companies due to attend the Goldman Sachs U.S. Financial Services conference in New York.

After the close, chipmaker Texas Instruments (TXN, Fortune 500) issues its mid-quarter update.

Wednesday: RealtyTrac releases its November foreclosure report.

The Commerce Department is expected to report in the morning that wholesale inventories for October fell 0.6% after falling 0.9% in the previous month.

The government's weekly crude oil inventories report is also due in the morning.

CNNMoney.com parent Time Warner (TWX, Fortune 500) completes its spinoff of AOL.

Thursday: The October trade balance from the Commerce Department is due before the markets open. The trade gap is expected to have widened to $37.1 billion from $36.5 billion in September.

The flow of funds report from the Federal Reserve is due around noon. The report is likely to show that household net worth continued to fall in the second quarter, along with home values.

The Labor Department's weekly jobless claims report is due out in the morning. The Treasury budget is due in the afternoon.

Treasury Secretary Timothy Geithner testifies before the Congressional Oversight Committee.

Federal Reserve Governor Elizabeth A. Duke speaks in Chicago on Mortgage Foreclosure policy.

Friday: The November retail sales report from the Commerce Department is due in the morning. Sales are expected to have risen 0.5% after rising 1.4% in the previous month. Sales excluding autos are expected to have risen 0.5% in November after rising 0.2% in the previous month.

The University of Michigan's preliminary consumer sentiment index for December is due just after the start of trading. Sentiment is expected to have improved to 68.5 from 67.4 in late November.

Reports on October business inventories and November import and export prices are also due.  

Dow Jones industrial average, Nasdaq-100 and S&P-500 futures were slightly higher.

Futures measure current index values against their perceived future performance and offer an indication of how markets may open when trading begins.

Stocks struggled in a choppy session Thursday, gaining early in the session on Bank of America's (BAC, Fortune 500) plan to pay back $45 billion of its bailout money. But the rally lost steam and stocks ended lower as investors prepared for the November jobs report.

Art Hogan, chief market strategist at Jefferies & Co., said the government's monthly report on the job market is the focus of trading, and there won't be much movement in the futures until that report comes out.

He said that estimates are in the widest range he has ever seen for this report: from 30,000 to 180,000 jobs lost for the month of November. He said a job loss of 105,000 or less will be "something to celebrate" and would likely result in a rally.

"We're looking for a decrease in the magnitude of jobs being lost," said Logan. "Every month we say this is the most important piece of data. This time we mean it."

He added that there's a good chance that stocks could flatten by the end of the day, as money managers look for an excuse to close their books -- not just for the week, but for the year.

Jobs. The Labor Department will release the November unemployment report before the start of trading.

A consensus survey of economists by Briefing.com expects employers cut 125,000 jobs from their payrolls in the month, after cutting 190,000 in October.

Economists expect the jobless rate to hold steady at 10.2%.

The October factory orders report is due at 10 a.m. Orders are expected to have remained flat in the month, after rising 0.9% in September.

Gold. Gold futures for February delivery slipped $11.40 to $1,206.90, after Thursday's all-time high settlement of $1,218.30.

World Markets. In Asia, Tokyo's Nikkei index rose for the fifth straight day, up 0.5%, but a 0.3% dip snapped the 4-day advance of Hong Kong's Hang Seng index. Major European indexes fell in midday trading.

Currency and oil. The dollar was lower against major international currencies, including the euro, the yen and British pound. The price of crude oil for January delivery eased 71 cents to $75.75 a barrel in electronic trading.  

Investors were also keeping an eye on the dollar, which fluctuated versus other major currencies, and a joint venture between General Electric and Comcast.

The Dow Jones industrial average (INDU) lost 86 points, or 0.8%. The S&P 500 index (SPX) lost 9 points or 0.8%. The Nasdaq composite (COMP) rose 12 points, or 0.5%.

Stocks gained in the early going, with Bank of America's news lifting the broader financial sector, but the financial sector turned mixed and the advance lost steam as the session wore on.

After watching the market rally more than 60% of the March 9 lows, many investors are now hunkering down in the last weeks of the year.

"Most investors have seen dramatic swings in their portfolios this year and there's a bias against making any big changes in this last month," said Larry Glazer, managing director at Mayflower Advisors. "There's a complacency going into year end that's going to make the jobs report less of a market mover than it might otherwise be."

Market breadth was negative. On the New York Stock Exchange, losers beat winners nearly two to one on volume of 1.13 billion shares. On the Nasdaq, decliners topped advancers by a narrow margin on volume of 2.02 billion shares.

Stocks struggled Wednesday, one day after the Dow industrials closed at a 14-month high. GM's management shakeup, record gold prices above $1,210 an ounce and mixed readings on the job market were all in play.

Also in focus: The Senate Banking Committee was holding its confirmation hearing on Ben Bernanke's second term as Federal Chairman.

Although Bernanke is widely expected to get the go-ahead to serve a second term, some Senators have been critical of the span of the Fed's power.

Committee chairman Christopher Dodd, D-Conn., gave his support to Bernanke in the morning, but also said some of the bank's current powers should be stripped.

Jobs and economy: The number of Americans filing new claims for unemployment last week fell to 457,000 from a revised 466,000 the previous week, the lowest level in 15 months.

Economists surveyed by Briefing.com thought the number would rise to 480,000. The report had only a minor impact on trading ahead of Friday's bigger monthly jobs report.

Employers are expected to have cut 125,000 from their payrolls after reducing 190,000 in the previous month, according to estimates. The unemployment rate, generated by a separate survey, is expected to have held steady at 10.2%.

Third-quarter productivity was revised down to an 8.1% annualized unit rate from a previous reading of 9.5%. Economists surveyed by Briefing.com thought it would fall to 8.5%. In other news, the Institute for Supply Management's reading on the services sector of the economy fell to 48.7 in November from 50.6 in October. Economists surveyed by Briefing.com thought it would rise to 51.5.

Retail sales: Sales for the month of November failed to benefit from a decent Thanksgiving weekend, according to reports released Thursday. Overall sales for the month of November rose just 0.5% versus forecasts for a 2.1% increase, according to Thomson Reuters.

On the upside, Nordstrom (JWN, Fortune 500) said sales rose 2.2% and Limited Brands (LTD, Fortune 500), which owns Victoria's Secret and other chains, said sales rose 3%. Shares of both companies gained.

On the downside, clothing chain Abercrombie & Fitch (ANF) said sales at stores open a year or more, or same-store sales, fell 17% from a year ago. Shares fell 9%. Retailer Children's Place (PLCE) said same-store sales fell 13%, sending shares down 12.5%.

GE-Comcast: Cable operator Comcast (CMCSA, Fortune 500) agreed to buy a majority stake in NBC Universal from General Electric (GE, Fortune 500), in a complex deal that creates a new entertainment company that would be worth $37.25 billion. The joint venture, consisting of NBC businesses and Comcast's cable networks, will ultimately give Comcast a 51% stake and GE a 49% stake.

Gold dips after new record: COMEX gold for February delivery rose $5.30 to settle at a new record of $1,218.30 an ounce.

The dollar and oil: The dollar fell versus the euro and gained against the yen.

U.S. light crude oil for January delivery fell 14 cents to settle at $76.46 a barrel on the New York Mercantile Exchange.

World markets: Overseas markets were mixed, with London's FTSE 100 and Germany's DAX each losing about 0.2% and France's CAC 40 ending with modest gains. Asian markets advanced, with Japan's Nikkei ending 3.8% higher.

Bonds: Treasury prices slipped, raising the yield on the 10-year note to 3.37% from 3.32% late Tuesday. Treasury prices and yields move in opposite directions.  

NEW YORK (CNNMoney.com) -- Stocks were set to open higher Thursday as investors consider Bank of America's decision to pay back all of its federal bailout funds, and as General Electric and Comcast formed a joint entertainment company.

Dow Jones industrial average, Nasdaq-100 and S&P-500 futures were higher.

Futures measure current index values against their perceived future performance and offer an indication of how markets may open when trading begins.

Stocks ended mixed Wednesday as investors reacted to a shakeup in GM's leadership, record gold prices, and mixed reading of the job market.

Ken Kam, chief executive and co-founder of Marketocracy in San Mateo, Calif., said the gains in futures stemmed from Bank of America's plan to pay back debt from the Troubled Asset Relief Program.

"It's more indication that the banking system is going to be able to earn its way out of its bad debt or bad loans," he said.

But Kam added that the gains in futures were "modest" because there is still a sentiment among investors that there are underlying problems with the banking sector, and that bailing out the banks is not going to fix the economy.

"There's still substantial uncertainty about this whole financial system," he said.

Company news. Bank of America (BAC, Fortune 500) announced late Wednesday that it planned to return the entire $45 billion in bailout money it received from the government in the past year.

The bank said the move would be done through the sale of $18.8 billion of securities it would convert into common stock.

GE (GE, Fortune 500) and Comcast (CMCSA, Fortune 500) announced Thursday that they signed an agreement to form a joint entertainment company that would be worth $37.25 billion and give the cable company eventual control of NBC Universal.

The joint venture will be 51% owned by Comcast and 49% owned by GE, the companies said, and will be comprised of NBC businesses and Comcast's cable networks.

Economy. The Labor Department will report the weekly jobless claims before the start of trading.

Approximately 480,000 Americans are expected to have filed new claims for unemployment, up from 466,000 the previous week.

Continuing claims, a measure of people who have been receiving benefits for a week or more, are expected to have dropped to 5,400,000 from 5,423,000 the previous week.

The nation's retailers will release their sales figures for November in the morning. The figures will include the critical Black Friday period.

The Senate Banking Committee is scheduled to hold a confirmation hearing on Ben Bernanke's second term as Federal Reserve Chairman at 10 a.m. ET

The revised reading on third-quarter productivity, the third-quarter employment cost index and the November ISM services sector index are all due as well.

Gold. Gold futures for February delivery surged to a record intraday high of $1,227.50, easing back to $1,217, up $4 from the settlement record of $1,213.

World markets. It was the fourth straight day of an Asian stock rally. Tokyo's Nikkei index surged to close up 3.8% amid indication the Japanese government will intervene to lower the yen's value; Hong Kong's Hang Seng index gained 1.1%. European indexes were slightly higher in midday trading.

Currency and oil. The dollar fell against the euro, but was up against the yen and the pound in early trading Thursday.

Crude oil for January delivery rose 43 cents to $77.03 a barrel. 

Mixed readings on the labor market, GM's management shakeup and record gold prices above $1,210 an ounce all played a role in the day's trading.

The Dow Jones industrial average (INDU) lost 19 points, or 0.2%. The blue-chip average ended the previous session at the highest point since Oct. 2, 2008. The S&P 500 (SPX) index ended little changed. The Nasdaq composite (COMP) rose 9 points, or 0.4%.

Stocks struggled as investors sorted through the day's news and geared up for the big monthly jobs report due Friday. Ahead of that, investors will keep an eye on Thursday's weekly jobless claims report from the Labor Department.

JPMorgan Chase (JPM, Fortune 500), American Express (AXP, Fortune 500), Chevron (CVX, Fortune 500) and Exxon Mobil (XOM, Fortune 500) were among the Dow's biggest losers.

The Fed released its periodic "Beige Book" reading on economic conditions in the nation's 12 districts. The central bank said economic conditions have improved modestly since its last report in the third week of October. However, labor market conditions remained weak and commercial real estate markets deteriorated.

"The report basically confirms that things are better than they have been, but that we are by no means off to the races," said Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc.

Shapiro said that, in the near term, it's fair to say that the data have largely supported the stock gains. But next year is more concerning.

"The issue is whether we're going to see enough profit growth and economic growth next year to justify continued equity gains," he said. "I'm concerned that by the second half of the year, we're going to run into more problems."

Stocks rallied Tuesday as worries about Dubai's debt problems eased, pushing the Dow to a 14-month high. The Nasdaq and S&P 500 both closed short of 14-month highs.

General Motors: GM's CEO Fritz Henderson resigned late Tuesday and will be replaced by chairman Ed Whitacre on a temporary basis, until a successor can be found.

Henderson was a 25-year GM veteran who took over as CEO in March after Rick Wagoner was forced out by the Obama administration as part of GM's government-supervised restructuring.

Labor market: The first in a three-day blitz of readings on the job market got underway Wednesday with mixed results.

Payroll services firm ADP said employers in the private sector cut 169,000 jobs from their payrolls in November versus forecasts for cuts of 150,000 jobs. Employers cut 196,000 jobs in October.

The report is seen as something of a precursor to the broader monthly labor market report due out Friday in which employers are expected to have cut 120,000 non-farm payroll jobs in November after cutting 190,000 in October.

Employers announced 50,349 planned job cuts in November, according to another report from outplacement firm Challenger, Gray & Christmas, down 9.6% from October and the lowest number in almost two years. But the total number of cuts announced this year have already outpaced last year's total.

Gold touches $1,200: COMEX gold for February delivery rallied $12.80 to settle at $1,213 an ounce, a new closing high. Gold rose as high as $1,218.40 during the session.

The dollar and oil: The dollar gained versus the euro and the yen after hovering in mixed territory in the morning.

U.S. light crude oil for January delivery fell $1.77 to settle at $76.60 a barrel on the New York Mercantile Exchange.

World markets: Overseas markets inched higher, with London's FTSE 100, Germany's DAX and France's CAC 40 all ending with slim gains. Asian markets advanced too, with Japan's Nikkei ending 0.4% higher.

Bonds: Treasury prices slipped, raising the yield on the 10-year note to 3.31% from 3.28% late Tuesday. Treasury prices and yields move in opposite directions.

Market breadth was positive. On the New York Stock Exchange, winners beat losers three to two on volume of 1.03 billion shares. On the Nasdaq, advancers topped decliners by eight to five on volume of 2.08 billion shares. 

The Dow Jones industrial average (INDU) added 127 points, or 1.2%, closing at the highest point since Oct. 2, 2008. The S&P 500 (SPX) index gained 13 points, or 1.2%, and closed just short of a 14-month high. The Nasdaq composite (COMP) rose 31 points, or 1.5%, and remained short of a 14-month high hit a week ago.

Bets that Dubai's debt problems won't have a major impact on U.S. institutions lifted stocks late Monday and through Tuesday's session. Stocks also reacted to the day's better-than-expected economic readings on construction spending and pending home sales.

"The market is treating Dubai like a non-event and continuing to trade on momentum," said Joe Clark, market analyst at Financial Enhancement Group.

He said that the momentum is likely to keep stocks aloft or even push them higher through year-end, despite the already substantial run up since the March lows.

Since bottoming at a 12-year low March 9, the Dow has gained nearly 60%, the S&P 500 has gained 64% and the Nasdaq has gained 72%.

Investors also kept an eye on auto sales, which were down from October but mostly higher from a year ago. After the close, GM said CEO Fritz Henderson has resigned and will be temporarily replaced by Chairman Ed Whitacre, until a successor is found.

The weak dollar also played a role in the day's advance, boosting commodity prices and stocks, continuing a trend that's been in place all year.

Gold touches $1,200: COMEX gold for December delivery rallied $18 to settle at $1,199.10 an ounce, after rising as high as $1,202.70. It's the first time the precious metal has ever traded at this level.

Company news: AIG (AIG, Fortune 500) said it is wiping out $25 billion of its government debt by selling stakes in two of its life insurance subsidiaries to the Federal Reserve Bank of New York. Shares gained 8.6%.

General Electric (GE, Fortune 500) has reportedly reached a deal to buy Vivendi SA's 20% stake in NBC Universal for about $5.8 billion, moving GE closer to its goal of partnering with Comcast (CMCSA, Fortune 500) to create one of the largest U.S. media companies.

GE is looking to sell a 51% stake in NBC Universal to Comcast, while retaining a 49% stake in the company that is valued at around $30 billion.

Dubai and world markets: Dubai World, the city-state's main investment arm, said it is in talks to restructure $26 billion in debt, cooling worries that it might go into default and wipe out the investment of its creditors.

Global markets slumped last week after the Dubai government asked to defer payments for at least six months on $60 billion in debt owed by Dubai World and Nakheel, its real estate arm.

Overseas markets surged, with London's FTSE 100, Germany's DAX and France's CAC 40 all closing with gains of more than 2%. Asian markets rallied too, with Japan's Nikkei ending 2.4% higher.

Autos: Major automakers reported sales in November that met or topped expectations. But any improvements year-over-year were easy, given the dismal results in November 2008. On a monthly basis, sales slumped from October levels.

Among the standouts: General Motors reported a 1.8% drop in November sales from a year ago, versus forecasts for a drop of 1.3%. But sales were down 15% from October levels. Ford Motor's sales were little changed from a year ago and down 10% from October.

ISM index: The November manufacturing index from the Institute for Supply Management fell to 53.6 from 55.7 in October, surprising economists who were looking for ISM to fall to 55. However, any reading over 50 implies expansion in the sector.

Pending home sales: Signed contracts to buy homes rose 3.7% in October, the ninth monthly increase in a row, according to a National Association of Realtors report released Tuesday. Pending home sales were expected to have fallen 1% after rising 6% previously.

Other economic news: Construction spending in October was unchanged, the government reported. Spending fell 1.6% in September and was expected to have fallen 0.5% in October, according to analysts' estimates.

President Obama is due to announce his strategy on Afghanistan in a speech Tuesday night from West Point.

The dollar and oil: The dollar fell versus the euro and gained against the yen.

U.S. light crude oil for January delivery rose $1.47 to $78.75 a barrel on the New York Mercantile Exchange.

Bonds: Treasury prices tumbled, raising the yield on the 10-year note to 3.27%, from 3.20% late Monday. Treasury prices and yields move in opposite directions.

Market breadth was positive. On the New York Stock Exchange, winners beat losers four to one on volume of 1.13 billion shares. On the Nasdaq, advancers topped decliners by two to one on volume of 2.20 billion shares. 

A weak dollar, rising commodity prices and the first wave of holiday retail sales reports were also in play during a tumultuous session on Wall Street.

The Dow Jones industrial average (INDU) added 35 points, or 0.3%. The S&P 500 (SPX) index gained 4 points, or 0.4%. The Nasdaq composite (COMP) rose 6 points, or 0.3%.

Stocks were flat to weaker through most of the session, but managed a late-day run up, led by financials. The bank sector as a whole was taken down late last week on Dubai worries. But bets that any damage will be contained gave those stocks a lift late Monday.

"The market is really showing resilience," said Dave Hinnenkamp, CEO at KDV Wealth Management. "It's amazing that even with the Dubai situation, stocks are managing to rise."

The KBW Bank (BKX) sector index jumped 3.4%, thanks to a rally in components JPMorgan Chase (JPM, Fortune 500), Bank of America (BAC, Fortune 500), Wells Fargo (WFC, Fortune 500) and Fifth Third Bancorp (FITB, Fortune 500).

Monday marked the first full trading session in five days, with all financial markets closed for Thanksgiving and stocks only trading in a half-session Friday.

Stocks tumbled in Friday's shortened session on the problems in Dubai. The major indexes were also vulnerable to a selloff after touching 13-month highs in the previous session. That vulnerability stuck around through most of Monday's session, until the last-hour run up.

Stocks are likely to remain range-bound for the time being, said Dean Barber, president at Barber Financial Group. "I wouldn't be surprised if we are talking about the Dow 10,000 for a while."

Retail: The first wave of reports for the critical Thanksgiving holiday weekend indicate that more Americans turned out this year to take advantage of deals, but the shoppers spent less than a year ago, on average.

According to the National Retail Federation, around 195 million people shopped in stores and online between Thanksgiving and Sunday, versus 172 million a year ago. But average spending per person dropped to $343.31 from $372.57 a year ago. Total spending for the holiday was $41.2 billion, up around 0.5% from the $41 billion spent last year.

On Monday, the retail focus turned to the Internet, for a day called Cyber Monday, when shoppers at home and at work take to the Web to scour for further deals.

Dubai and global markets: The United Arab Emirates said Sunday that it will provide emergency support for banks in Dubai, cooling some worries that a debt default in the city-state could challenge the global economic recovery.

Stocks around the globe slumped last week after the Dubai government asked to defer payments on $60 billion in debt owed by Dubai World and Nakheel. Dubai World is the city-state's main investment arm and Nakheel is its real estate arm.

Dubai's construction boom has helped turn the Emirate into a world financial center and tourist hot spot. But Dubai has suffered from the same sort of real estate collapse that battered the U.S. economy, with values plummeting even as pricey projects continue to get underway.

Dubai stocks plummeted Monday, the first trading day in the region after a 4-day religious holiday. Asian markets managed gains Monday, after tumbling last week. European markets tumbled, with London's FTSE 100, Germany's DAX and France's CAC 40 all losing at least 1%.

"What's happening in Dubai right now is another verification that the mountain of debt we've accrued in the world is unsustainable," Barber said.

AIG: AIG bucked the trend, missing out on the financial sector stock advance after an analyst at Sanford Bernstein cut its price target on the stock, saying that the insurer's loss reserves are too low.

Economy: The Chicago PMI, a regional read on manufacturing, rose to 56.1 in November from 54.2 in October. Economists surveyed by Briefing.com thought the index would fall to 53.3. Any reading over 50 indicates expansion.

Mortgage regulation: In other news, the Obama administration said it will up the pressure on mortgage companies that aren't doing enough to help borrowers who are at risk of foreclosure -- including imposing fines and sanctions.

Currency and commodities: The dollar gained versus the euro and fell against the yen.

COMEX gold for December delivery rose $6.90 to settle at $1181.10 an ounce, not far from an all-time high of $1,187 an ounce hit last week.

U.S. light crude oil for January delivery rose $1.23 to settle at $77.28 a barrel on the New York Mercantile Exchange.

Bonds: Treasury prices rose modestly, with the yield on the 10-year note holding steady at 3.20%, unchanged from Friday. Treasury prices and yields move in opposite directions.

Market breadth was negative. On the New York Stock Exchange, advancers beat decliners four to three on volume of 1.35 billion shares. On the Nasdaq, winners topped losers by a narrow margin on volume of 2.03 billion shares.