The Dow Jones Industrial Average closed up 175 points on Wednesday, less than 1 percent from its all-time high set in October 2007 and the closest it has been to that high in more than five years.

The Dow closed up 1.3 percent to 14,075 at the close of New York trading, its highest close so far this year.

Positive economic data out of the in the U.S. and Europe appeared to boost markets today.

The number of Americans who signed contracts to buy homes rose to the highest level since April 2010. The increase pointed to more home sales in the coming months.

Orders for factory goods grew by the most in more than a year, suggesting that companies are confident enough to invest some of their cash.

An Italian bond auction went better than expected despite the political chaos there after an inconclusive election earlier in the week failed to give any of Italy's major political parties enough votes to form a government.

Finally, Federal Reserve Chairman Ben Bernanke, in a second day of Congressional testimony, reassured investors that the Fed will not abruptly end its economic stimulus.