Stocks rallied yesterday after a series of steep declines, as the Dow Jones industrials rose 132.98 points to 9,956.39 at the closing bell and the Nasdaq up 60.53 points to 1,951.44.

The Standard and Poor's 500 advanced 20.11 points to 1,170.64.

The rally gained momentum late in the session and reversed a downward trend earlier in the day in Asian and European markets.

Last week, a brutal sell-off sent the Dow industrials down 7.7 per cent while the Nasdaq tumbled 7.8 per cent amid fears of a global economic slowdown.

Investors were expecting a boost for stocks today from the Federal Reserve, which was expected to cut short-term rates by at least a half-point.

On the bond market yesterday the yield on the 10-year bond rose to 4.815 per cent from 4.752 per cent Friday and on the 30-year bond to 5.289 per cent against 5.270 per cent.