NEW YORK (AFP) - US stocks rebounded Monday from last week's Ukraine-linked setback as fears of a clash with Russia ebbed, with the Dow surging 1.1 per cent and Nasdaq reaching a 14-year high.
Markets also got a spark from a brewing bidding war over the discount retail sector by the three "Dollar" chains.
The Dow Jones Industrial Average finished up 175.83 points (1.06 per cent) at 16,838.74.
The broad-based S&P 500 added 16.68 (0.85 per cent) at 1,971.74, while the tech-rich Nasdaq Composite gained 43.39 (0.97 per cent) to 4,508.31.
The Dow had led a sell-off Friday amid worries of a looming clash between Russian and Ukraine forces. But tensions fell back after the two sides held talks on the weekend, and investors pushed back into the Dow's blue chips
The Nasdaq gauge moved to its highest level since March 31, 2000, when the market was beginning a nearly 4,000 point crash as the tech bubble burst.
Monday's gains took the tech-heavy index within 540 points of the all-time closing high on March 10 of that year.
Leading the Dow higher were Boeing (+1.5 per cent), General Electric (+1.7 per cent), Nike (+1.8 per cent) and United Technologies (+2.3 per cent).
On the Nasdaq, among leading gainers were American Airlines (+3.8 per cent), Yahoo (+2.5 per cent), Google (+1.5 per cent), and Facebook (+1.3 per cent).
Family Dollar was in play again just weeks after signing a deal to be taken over by Dollar Tree. Rival Dollar General made a counter-offer worth US$9.7 billion (S$12 billion), or US$78.50 a share, US$4 more than Family Dollar's.
Family Dollar shares gained 4.9 per cent to US$79.81, while Dollar General was up 11.6 per cent and Dollar Tree fell 2.4 per cent.
Monster Beverage gave up 5.4 per cent, just a part of the 30.5 per cent gain it made Friday after Coca-Cola announced the US$2.15 billion purchase of a nearly 17 per cent stake in the energy drink company.
Big banana company Chiquita Brands rose 1.9 per cent to US$13.89 after the two Brazilian firms seeking to buy the company and block its merger with European banana king Fyffes urged shareholders to back their bid, initially set at US$13.
Chiquita's board last week rejected the bid by the Safra and Cutrale groups as undervaluing the company.
Bond prices sagged. The yield on the 10-year US Treasury rose to 2.39 per cent from to 2.35 per cent late Friday, while the 30-year advanced to 3.19 perc ent from 3.14 per cent. Bond prices and yields move inversely.