Strong September retail sales data coupled with better-than-expected quarterly results by Citigroup drove the benchmarks into the positive territory yesterday. The positive tone helped benchmarks to rebound from its previous week’s losses and guided Dow to register its biggest gain in one month. Financial sectors and health care sectors were the major gainers yesterday. However, investors remained watchful about Spain’s bailout.

The Dow Jones Industrial Average (DJI) rose 0.7% to close the day at 13,424.23. The Standard & Poor 500 (S&P 500) climbed 0.8% to finish yesterday’s trading session at 1,440.13. The tech-laden Nasdaq Composite Index surged 0.7% to end at 3,064.18. The fear-gauge CBOE Volatility Index (VIX) was down by 5.4% to settle at 15.27. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.9 billion shares, slightly lower than year-on-year daily average of 6.52 billion shares. The advancing stocks outran the declining stocks on the NYSE in the ratio 2 to 1.

The Street enjoyed a bullish sentiment from the very beginning of the trading session banking on a couple of positive news. The U.S. Census Bureau released its retail sales data, which revealed that the retail sales rose 1.1% to $412.9 billion in September, beating the consensus estimates of 0.8%. According to the government, the retail sales gains in August and September were the largest ones since October 2010. Separately, Retail trade sales gained 1.2% from August and 5.3% from year-ago period. The nonstore retail sales jumped 15.0% from September 2011.

The rise in retail sales helped the Consumer Discretionary SPDR to climb 1.0% yesterday. Stocks such as Wal-Mart Stores, Inc. (NYSE:WMT), PriceSmart, Inc. (NASDAQ:PSMT), Sears Holdings Corporation (NASDAQ:SHLD), Target Corporation (NYSE:TGT) and Big Lots, Inc. (NYSE:BIG) rose 1.8%, 0.8%, 0.7%, 0.5% and 2.6%, respectively.

Meanwhile, Citigroup Inc. (NYSE:C), the third-largest U.S. bank, reported its third-quarter earnings results beating the analysts’ estimates. Citigroup’s shares surged 5.5% following the announcement of the earnings results; the biggest advance since March. The company’s results were boosted by $582 million tax benefit, increase in bond-trading revenue and surge in mortgage lending. The other two financial bellwethers, JPMorgan Chase & Co (NYSE:JPM) and Wells Fargo & Company (NYSE:WFC), had also reported better-than-expected results last Friday.

Financial Select Sector SPDR surged 1.1% after the encouraging result. Financial stocks such as Morgan Stanley (NYSE:MS), JPM, Goldman Sachs Group, Inc. (NYSE:GS) and Bank of America Corp (NYSE:BAC) surged 2.5%, 1.8%, 3.6% and 3.5%, respectively.

Coming to the healthcare sector, it enjoyed decent gains and remained the top performer in S&P 500. Eli Lilly & Co. (NYSE:LLY) gained 4.1% following the news that its potential stomach cancer treatment had achieved the goal for improving the patient survival. Whereas, Abbott Laboratories’s (NYSE:ABT) experimental hepatitis C candidate showed positive signs. The news pushed shares of Abbott Laboratories up by 4.0%. Stocks such as Pfizer Inc. (NYSE:PFE), Merck & Co., Inc. (NYSE:MRK) and Bristol Myers Squibb Co. (NYSE:BMY) gained 1.8%, 2.1% and 2.5%, respectively.

On the international front, investors remained watchful about developments related to Spain’s bailout. According to a Euro-zone official, Spain could ask for bailout next month. On the other hand, China’s rate of inflation has come down to 1.9% in September from 2.0% the month before.