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NEW YORK, Dec 18 AFP

December 19 2012, 08:26AM

US stocks rallied on Tuesday amid optimism that Washington was serious about reaching a deal on the "fiscal cliff".

The Dow Jones Industrial Average gained 115.73 points (0.87 per cent) at 13,351.12 in closing trade.

The broad-market S&P 500 climbed 16.42 points (1.15 per cent) at 1,446.78, while the tech-rich Nasdaq Composite rose 43.93 points (1.46 per cent) to 3,054.53.

President Barack Obama and top Republican John Boehner have stepped up negotiations in recent days in an apparent effort to avert the so-called fiscal cliff -- a combination of tax hikes and spending cuts set to take effect in January.