U.S. stocks rallied, sending benchmark gauges toward their biggest gains since August, as central banks acted to make additional funds available to lenders as Europe’s crisis threatens global economic growth.

Stocks rallied after China cut the amount of cash that banks must set aside as reserves for the first time since 2008. The Fed and five other central banks agreed to reduce the interest rate on dollar liquidity swap lines by 50 basis points and extend their authorization through Feb. 1, 2013.

In the U.S., the number of Americans signing contracts to buy previously owned homes rose more than forecast. Companies added more workers than anticipated in November, according to a private report based on payrolls. The Institute for Supply Management-Chicago Inc. said its business barometer increased to 62.6 in November from 58.4 the prior month.

Dow 11,969.28 +413.65 +3.58%, Nasdaq 2,602.28 +86.77 +3.45%, S&P 500 1,236.24 +41.05 +3.43%

All 10 groups in the S&P 500 rose as gauges of commodity and financial shares added at least 4.3 percent. A measure of homebuilders in S&P indexes increased 5.6 percent. U.S. Steel surged 12 percent to $26.46. Caterpillar gained 6.3 percent to $96.26. D.R. Horton added 6.3 percent to $11.96.

Financial shares tumbled after the close of regular trading as S&P cut credit ratings for lenders including Bank of America and Citigroup Inc. JPMorgan added 6.5 percent, the most in the Dow, to $30.41 today. Bank of America gained 4.7 percent to $5.31 today. Citigroup rose 6.5 percent to $26.88.

American Airlines parent AMR Corp. increased 50 percent to 39 cents. The shares tumbled 84 percent yesterday after the company announced a bankruptcy filing.

Netflix Inc. slumped 2.3 percent to $66.03. The video- streaming and DVD subscription service was cut to “underperform” from “neutral” at Wedbush Securities Inc, citing rising content costs, continued customer losses and concern about the company’s “growth at all costs business model.” Wedbush gave a 12-month price estimate of $45 a share.