Bank stocks and the broader markets rose Monday on a better-than-expected report on retail sales and a pledge by Federal Reserve Chairman Ben Bernanke to keep interest rates low.

The KBW Bank Index rose 1.09%, the Dow Jones industrial average, 1.33%, and the Standard & Poor's 500 index, 1.45%.

The Commerce Department said that U.S. retail sales rose 1.4% in October, much more than the 0.8% increase that economists on average had predicted. In September, retail sales fell 2.3%.

Meanwhile, in a speech to the Economic Club of New York, Bernanke said that the Fed would keep interest rates low as the economy recovers.

Raymond James & Associates analyst Anthony Polini wrote in a note Monday that his team remains "bullish on the industry's overall investment appeal and look for buying opportunities in the weeks ahead."

"Yearend results are expected to ease credit-quality concerns as bankers accelerate balance sheet cleanups and position themselves for improved operating performances in 2010," Polini wrote. "About half of the stocks in our industry average still trade below book value, and the average" price-to-book ratio is only 112%, compared to the normalized average of 150%."

JPMorgan Chase & Co. rose 0.3%; Wells Fargo & Co., 1.9%; PNC Financial Services Group Inc., 2.5%; and Citigroup Inc., 13 cents a share, to $4.18.

However, Bank of America Corp. fell 0.7%, and U.S. Bancorp was off 0.4%

Among the regional banking companies, SunTrust Banks Inc. rose 4.2%; BB&T Corp., 1.6%; Capital One Financial Corp., 2.8%; Fifth Third Bancorp, 0.2%; Marshall & Ilsley Corp., 0.4%; Comerica Inc., 2.1%; M&T Bank Corp., 1.4%; Zions Bancorp., 2.1%; First Horizon National Corp., 0.7%; Hudson City Bancorp Inc., 1.7%, and Regions Financial Corp., 10 cents, to $4.93 a share.

KeyCorp was unchanged from Friday's close of $5.59 a share.

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