Oil prices retreated for a second day in a row from record highs as investors snapped up bargains in the financial services sector. The Dow surged 152 points to close at 11,384 while Nasdaq soared 51 points to finish the session at 2294.

On the upside

Shares of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) rebounded on hopes that the Federal Reserve bank may intervene and prevent foreclosures by extending its lending efforts to investment banks.

PriceSmart (Nasdaq: PSMT) which operates shopping warehouse clubs in Central America and the Caribbean posted 3rd quarter profits that doubled.

Stage Stores (NYSE: SSI) reported higher same-store sales in June. The clothing and accessories retailer affirmed its 2nd quarter outlook.

On the downside

VMware (NYSE: VMW) abruptly replaced its co-founder CEO without explanation. Shares of controlling shareholder EMC (NYSE: EMC), a data storage company, also fell.

Shares of Chevron (NYSE: CVX) and United States Oil (NYSE: USO) fell as oil prices retreated.

Shares of InterDigital (Nasdaq: IDCC) tumbled after the U.S. International Trade Commission issued a nonbinding ruling against the wireless technology developer in a patent dispute against Samsung Electronics.

In the broad market, advancing issues edged out decliners by a margin of nearly 2 to 1 on the NYSE and by more than 2 to 1 on Nasdaq. The Russell 2000 which tracks small cap stocks surged 24 points to close at 682.