Stocks surge amid cliff deal bets

The stock market shot higher even as the “fiscal cliff” neared. By the time trading ended, Republicans and Democrats still had not reached a budget compromise – but investors were betting that they would.

It was a dramatic day on what turned out to be a strong year for stocks. The Standard & Poor’s 500 index rose 13.4% for the year, after finishing flat in 2011. It was the index’s best year since 2009.