NEW YORK — Investors barreled into stocks for a second day, betting that corporate profits will surge as the global economy recovers.
The Dow Jones industrial average rose 132 points, bringing its two-day advance to 244, as major stock indicators rose more than 1 percent.
Investors’ show of confidence ahead of flood of corporate earnings reports came as Australia became the first major country to raise interest rates since the onset of the financial crisis last year.
The move signals that policymakers see the country’s economy as strong enough to withstand higher borrowing costs. That touched off hopes that other economies may also be strengthening.
Australia’s decision also dented demand for the U.S. dollar, which, in turn, raised commodity prices. U.S. energy and materials stocks jumped as oil rose and gold reached a record high.
The upbeat tone among investors is a departure from recent weeks when disappointing reports on unemployment, manufacturing and consumer sentiment gave stocks their first back-to-back weekly drops since July.
Investors seem inclined right now to grab hold of any good news they hear, and their shifting sentiment has led to some mild volatility including the surge upward this week.
The market’s climb comes as some investors ratchet up their expectations for companies’ earnings for the July-September quarter. Yum Brands Inc., parent of the Taco Bell, KFC and Pizza Hut chains, reported results after the closing bell that topped expectations. Aluminum producer Alcoa Inc. reports on Wednesday.
Phil Orlando, chief equity market strategist at Federated Investors in New York, said investors are raising their expectations for overall earnings …
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