YAHOO: Stocks rallied Monday as investors welcomed positive developments in the credit markets and Fed Chairman Bernanke supporting the idea of a second fiscal stimulus package.In the end, the S&P 500 rallied 4.8%, settling at session highs thanks to a late-session surge in buying interest.  Strength was mostly broad-based, with all ten sectors posting a gain.  Volume, however, was on the light side with only 1.23 billion shares exchanging hands on the NYSE, compared to the one-year average of 1.49 billion.During testimony to the House Budget Committee, Fed Chairman Bernanke said he feels the government's recent efforts will help restore the financial system, but cautioned the stabilization of the financial system will not quickly eliminate economic challenges.Given the likelihood of a weak economy for several quarters, Bernanke said it would be appropriate for Congress to consider a second fiscal stimulus. He feels that a fiscal package should be targeted to boost overall spending and economic activity, aimed at improving credit for consumers, home buyers, business and other buyers and limit long-term effects on the government's budget deficit.Meanwhile, overseas governments took more actions to help alleviate the financial market turmoil. India cut its key lending rate for the first time since 2004, South Korea said it will guarantee some of the foreign debt held by its banks, and the Netherlands is injecting approximately $13 billion in ING (ING 12.93, +2.28).Credit markets continue to show improvements. Short-term interbank lending in dollars, measured by Libor, declined across all terms. The difference between what banks pay each other for three-month loans and what the government pays, known as the TED Spread, declined 65 basis points to 2.96%. The TED Spread is well off its 4.34% high reached on October 10, but levels remain substantially above the historically average of roughly 0.4%.In corporate news, utility company Exelon (EXC 54.58, +0.08) made an unsolicited proposal to acquire NRG Energy (NRG 25.00, +5.67) for $26.43 per share, or $6.2 billion, in stock. The offer represents a 37% premium to Friday's closing level. The utilities sector as a whole climbed 8.1%.Eaton (ETN 45.05, +0.63), Halliburton (HAL 20.80, +2.54), and Hasbro (HAS 28.79, -1.33) topped estimates for their respective latest quarters. On the negative side, Novartis AG (NVS 52.16, +1.22) and Mattel (MAT 14.07, -0.38) reported earnings that fell short of expectations.The better-than-expected results from Halliburton, and a 3.8% gain in oil prices, helped the energy sector spike 11.2%.The financial sector (+2.8%) underperformed on a relative basis, with notable weakness in retail (-3.4%) and industrial (-2.1%) REITs. In economic news, September leading indicators rose 0.3%, although August's decline of 0.5% was widened to 0.9%. Economists had forecast a drop of 0.1% in September. The leading indicators report is mostly a collection of previously announced economic indicators.DJ30 +413.21 NASDAQ +58.74 SP500 +44.85 NASDAQ Adv/Vol/Dec 2099/2.05 bln/696 NYSE Adv/Vol/Dec 2657/1.23 bln/492