U.S. stocks rallied, almost wiping out this year’s decline in the Standard & Poor’s 500 Index, amid takeover deals, higher-than-estimated earnings at Caterpillar Inc. (CAT) and progress in talks to tame Europe’s debt crisis.

Gauges of commodity, financial and technology shares had the biggest gains in the S&P 500 among 10 groups, rising at least 1.9 percent. Caterpillar, the largest construction and mining-equipment maker, climbed 5 percent. RightNow Technologies Inc. (RNOW) surged 19 percent, while Healthspring Inc. (HS) soared 34 percent, on acquisitions. Alcoa Inc. (AA) added 3.4 percent as metals advanced on signs of growth in China and Japan.

The S&P 500 increased 1.3 percent to 1,254.19 as of 4 p.m. New York time, paring its 2011 retreat to 0.3 percent. The Dow Jones Industrial Average climbed 104.83 points, or 0.9 percent, to 11,913.62 today. The Nasdaq Composite Index gained 2.4 percent, erasing its year-to-date decline. The Russell 2000 Index of small companies advanced 3.3 percent.

“The world isn’t ending,” Keith Wirtz, who oversees $16.7 billion as chief investment officer at Fifth Third Asset Management in Cincinnati, said in a telephone interview. “If there’s any sentiment change after five months of market declines, you’re going to get a rebound in stock prices. The market is just hungry to get the European crisis behind us and focus on domestic news. We’re not in a recession.”

The S&P 500 has risen 11 percent so far in October, poised for its best monthly gain since 1991, after falling for five straight months. It rose from the threshold of a bear market early in October on steps by European leaders to support banks and higher-than-estimated earnings. The rebound brought the index above a price range where it had traded since August.