* S&P 500 breaks above 200-day moving average
* Bank shares lifted after Basel III agreement
* Upbeat China factory data boosts economic optimism
* Indexes up: Dow 0.5 pct, S&P 0.9 pct, Nasdaq 1.6 pct
* For up-to-the-minute market news see []
(Updates to late afternoon, changes byline)
By Chuck Mikolajczak
NEW YORK, Sept 13 (Reuters) - U.S. stocks advanced to their
highest levels in almost six weeks on Monday, taking the S&P
500 index back near to the top of its summer range on upbeat
Chinese factory data and new global banking rules.
Indexes pared some early gains as the S&P 500 moved closer
to the 1,130 level, a level which the benchmark index has been
unsuccessful in holding above since May. Analysts said a
significant break above that point could mean more gains lie
ahead.
"In a range-bound market like we've been in, we are clearly
testing the top ends here," said Kevin Kruszenski, head of
listed trading at KeyBanc Capital Markets in Cleveland. "The
frustration (for traders) is we tend to get there very quickly
and not on a lot of volume."
Global regulators agreed to force banks to more than triple
their top-quality capital reserves in hopes of preventing
another credit crisis. But the new rules, known as "Basel III,"
provide transition periods that could extend to January 2019 or
later -- more time than many bankers expected. For details, see
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Chinese factories ramped up production in August, data
showed, while a key measure of money growth easily topped
expectations. The data built on recently improved sentiment in
U.S. markets as worries eased over whether the economy was
headed back into recession. []
"What it suggests -- at least with the China demand and
with the European banks doing what they are doing -- is there
is not a massive double dip or something really disturbing
underneath the surface and that is why we are rallying," added
Kruszenski.
Banks were among the top performers on Wall Street, with
JPMorgan Chase & Co <JPM.N> rising 3.7 percent to $41.23 as the
top boost to the Dow. The KBW Bank index <.BKX> climbed 2.8
percent.
The Dow Jones industrial average <> gained 55.02
points, or 0.53 percent, to 10,517.79. The Standard & Poor's
500 Index <.SPX> rose 9.81 points, or 0.88 percent, to
1,119.36. The Nasdaq Composite Index <> added 35.00
points, or 1.56 percent, to 2,277.48.
Indexes were on pace for a fourth consecutive winning
session, including an eighth day of gains out of the last nine
for the S&P 500 and Dow. With Monday's rise, all three indexes
were in positive territory for the year.
The gains sent the S&P 500 above its 200-day moving average
for the first time since early August.
Another acquisition in the technology sector added to the
optimism.
Hewlett-Packard Co <HPQ.N> will buy cybersecurity company
ArcSight Inc <ARST.O> for $1.5 billion, the latest in a series
of technology-sector transactions. ArcSight jumped 24.9 percent
to $43.85, while HP edged down 0.1 percent at $38.15.
[]
(Reporting by Chuck Mikolajczak; Editing by Diane Craft)
