(Bloomberg) U.S. stocks rose, extending their first weekly gain of the year, after odds increased that the Federal Reserve will cut its benchmark lending rate by half a percentage point this week to prop up the economy.

Bank of America Corp., JPMorgan Chase & Co. and Citigroup Inc. climbed in New York Stock Exchange trading and led financial shares to their fourth advance in five days on expectations that reduced borrowing costs will boost profits. Lennar Corp. and Centex Corp. rallied, sending homebuilders’ shares to the highest level since October, as the prospect for lower interest rates overshadowed a government report showing the biggest yearly drop in new-home sales on record.

The Standard & Poor’s 500 Index added 23.36, or 1.8 percent, to 1,353.97. The Dow Jones Industrial Average increased 176.72, or 1.5 percent, to 12,383.89. The Nasdaq Composite Index gained 23.71, or 1 percent, to 2,349.91. More than five stocks rose for every one that fell on the NYSE. [MORE]