A report by U.N. weapons inspectors made war seem inevitable and gave investors some long-awaited certainty after weeks of wrenching speculation that has routed stocks. U.N. inspectors said that while they'd uncovered no weapons of mass destruction in Iraq, many banned materials remain unaccounted for, which many believe increases the chances of a military conflict.

While investors are worried about a war, they fear uncertainty more.

"What I am hearing is: 'We are going to war in two to three weeks. The last time we went to war, we rallied. So, let's rally now,' " said Larry Wachtel, market analyst at Prudential Securities.

The Dow closed up 158.93, or 2.1 percent, at 7,908.80, according to preliminary calculations. The blue chips recouped a large chunk of the 170.24 points lost in the previous three sessions. Today's win was the Dow's largest one-day victory since Jan. 9, when it rose 180.87.

The market's broader indicators also jumped sharply higher. The Nasdaq composite index rose 32.73, or 2.6 percent, to 1,310.17. The Standard & Poor's 500 index climbed 17.52, or 2.1 percent, to 834.89.

Today's buying spree enabled the indexes to score their first winning week in five weeks. For the week, the Dow and S&P 500 each rose 0.6 percent, while the Nasdaq gained 2.2 percent.

Many on Wall Street believe the market will rally after military action is undertaken in Iraq, as was the case with the Gulf War. However, until there is more clarity on the situation, analysts are dubious that any gains will be long lived. Today's advance was only the second in nine sessions. "We have continuing geopolitical worries being brought to the fore," said Jack Caffrey, equities strategist at J.P. Morgan Private Bank.

Concerns about war have been the biggest drag on the market so far this year, stripping the Dow of about 900 points since Jan. 14, when the blue chips stood at 8,842.62, their high for 2003.

So far this year, the Dow has dropped 5.2 percent, the Nasdaq has lost 1.9 percent and the S&P has declined 5.1 percent.

Today's batch of economic news was mostly upbeat. Industrial production surged in January, rising by 0.7 percent while businesses boosted inventories the month before ­ two signs of promise for a flagging economy.

The increase in industrial activity, reported by the Federal Reserve, was a turnaround from the 0.4 percent drop in December.

Meanwhile, the Commerce Department reported that U.S. companies boosted inventories by 0.6 percent in December, the most in three months, as retail sales during the holidays fell short of expectations.

But the University of Michigan's preliminary report on consumer sentiment for February showed a decrease to 79.2 from 82.4 in January. Economists were expecting 82.0.

Among Wall Street's winners, Dell Computer climbed $2.52 to $25.77 after posting sharply higher fourth-quarter earnings late Thursday in line with analysts' expectations.

Krispy Kreme Doughnuts surged $2.75 to $31.15 after the company said profits in the current fiscal year will jump 35 percent.