YAHOO: Stocks and commodities surged on Election Day, benefiting from some better-than-expected quarterly earnings results, improvement in the credit market and a report that the a broader range of financial firms may receive investments from the Treasury.

The S&P 500 rose 4.1% in broad-based strength, ending near its best level of the session.  Small-cap names, however, saw less of a bid, with the Russell 2000 Index closing up just 1.3%.

Commodities rallied 5.3% as the dollar tumbled 1.8% against a basket of world currencies. Oil futures for December delivery surged 9.0% to $69.65 per barrel, getting an added boost from reports that some OPEC members were cutting production.

Credit markets continue to show improvement and investors are showing less fear. Interbank dollar lending, known as Libor, declined across all terms and the TED Spread fell 18 basis points to 2.24%. The Volatility Index, which is considered the "fear index", declined 11%.

General Electric (GE 20.81, +1.51) was the best-performing S&P 500 component. The U.S. Treasury is considering investments in a broad range of financial companies, not just banks and insurers, The Wall Street Journal reported, citing sources. The report specifically mentioned GE's capital unit and CIT Group (CIT 6.15, +1.63) as possible recipients. A GE spokesperson said a Treasury investment is not expected, although GE would consider an offer if one was made,  Reuters reported.

In earnings news, MasterCard (MA 169.37, +25.48), Archer Daniels Midland (ADM 24.23, +3.12) and Automatic Data Processing (ADP 36.23, +2.96) topped estimates for their latest quarters. The latter company, however, gave downside revenue guidance for its fiscal year 2009.

All ten of the economic sectors rose, led by energy (+6.4%), telecom (+5.2%) and industrials (+5.5%). Healthcare (+1.6%) and utilities (+2.3%) underperformed on a relative basis.

In economic news, market participants shrugged off negative factory orders data. September factory orders fell 2.5% month-over-month after dropping 4.3% in August. The results were worse than the 0.8% decline that was expected.

Despite the rally in stocks, the longer term Treasuries rallied.  The 10-year note rose 48 ticks and the 30-year bond rose 68 ticks in light trade.

The S&P 500 has surged 19.8% since its October 10 multi-year low. Despite the massive advance, it is still down 31.5% year-to-date.DJ30 +305.45 NASDAQ +53.79 NQ100 +3.3% R2K +1.4% SP400 +2.3% SP500 +39.45 NASDAQ Adv/Vol/Dec 1758/2.33 bln/1006 NYSE Adv/Vol/Dec 2464/1.31 bln/663