Stocks gain 1%-2% in week Blue-chip index past 1

Stocks gain 1%-2% in week
Blue-chip index past 13,000 level last seen in May
NEW YORK (MarketWatch) — U.S. stocks posted steep gains for a second day Friday, reclaiming a weekly advance as investors anticipated moves by the European Central Bank as well as the U.S. Federal Reserve.

Stocks hit session highs after Bloomberg News reported European Central Bank President Mario Draghi would hold talks with Bundesbank President Jens Weidmann in an attempt to remove the biggest obstacles to adopting new measures including bond purchases.

“Between Draghi’s comments and the gross domestic product numbers today, we’re bid up on prospects of monetary intervention,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott.

The Dow Jones Industrial Average (DJI JIA) ended up 187.73 points, or 1.5%, to 13,075.66, its first close above 13,000 since May 7 .

Merck & Co. Inc. (NYSE:MRK) led the gains that included all 30 components, rallying 4.1% after the pharmaceutical company’s earnings topped forecasts. Read more on Merck.

Friday’s gains marked the second session of triple-digit increases for the Dow and its third day of gains, with rallies in the past two sessions underpinned by comments from European policy makers.

Stocks started the session higher after German Chancellor Angela Merkel and French President Francois Hollande said they were committed to keeping the euro area together. French newspaper Le Monde reported the European Central Bank was readying to purchase debt. Read more on Europe Markets.

On Thursday, the Dow had jumped more than 200 points after the ECB’s Draghi suggested policy makers could step into bond markets, saying the ECB would do “whatever it takes to preserve the euro.” Read more on Draghi.

The S&P 500 index (SNC:SPX) added 25.95 points, or 1.9%, to 1,385.97, extending gains into a second session. Health care and technology were the best performing of the index’s 10 major industry sectors, all of which advanced. It rose 1.7% for the week.

Amgen Inc. (NASDAQ:AMGN) gained 5.8% after the biotechnology company raised its 2012 outlook and reported second-quarter profit that exceeded analysts’ estimates. Read more on Amgen.

The Nasdaq Composite (NASDAQ:COMP) gained 64.84 points, or 2.2%, to 2,958.09.

Facebook Inc. (NASDAQ:FB) shares slid nearly 12% after the social-networking site offered little reassurance to investors concerned about its lofty valuation. See story on Facebook’s earnings. http://www.marketwatch.com/story/us-stocks-ga...2012-07-27