Stocks extended gains on Thursday after data showed factory orders rose in February, fueling optimism the economy was showing signs of stabilization.

The data added on to earlier gains spurred by optimism G20 leaders meeting in London will agree on ways to temper the global economic crisis.

U.S. accounting rule-makers agreed to make adjustments to a proposal to change mark-to-market accounting rules about when transactions would be considered distressed.

The Dow Jones industrial average <.DJI> rose 205.49 points, or 2.65 percent, to 7,967.09. The Standard & Poor's 500 Index <.SPX> gained 22.68 points, or 2.80 percent, to 833.76. The Nasdaq Composite Index <.IXIC> was up 43.79 points, or 2.82 percent, at 1,595.39.

(Reporting by Leah Schnurr; Editing by James Dalgleish)