New York ? The Dow Jones industrials stormed up more than 480 points and back over 8,000 Wednesday as Wall Street cheered legal and legislative reassurance about the corporate ethics scandals that fueled nine weeks of sharp losses.

The Dow’s advance was its second largest point gain ever, and other market indicators also enjoyed solid gains, a marked change from nine weeks of sharp losses.

Although stocks began the day by extending a four-day losing streak, the arrest of top Adelphia Communications Corp. executives for allegedly looting the cable TV company fed a rally that intensified as the session wore on. An agreement between House and Senate negotiators on legislation to crack down on corporate fraud added momentum to the advance.

Still, many market observers were dubious about the sustainability of the rebound, noting that stocks have rallied before and then pulled back.

“I’m a little skeptical,” said Todd Clark, head of listed equity trading at Wells Fargo Securities. “Every time we’ve had one of these violent rallies, it’s been a classic bear market bounce with no follow-through.”

The Dow closed up 488.95, or 6.4 percent, at 8,191.29, according to preliminary calcuations, second only to the 499.19-point gain it had on March 16, 2000.

The surge was also the Dow’s first triple-digit gain since July 5, when the average rose 324 points. However, it was still indicative of the volatility that has swept over Wall Street lately. The Dow had dropped more than 170 points early in the day before shooting higher.

Broader indicators also closed sharply higher. The technology-focused Nasdaq composite index advanced 60.96, or nearly 5 percent, to 1,290.01. The Standard & Poor’s 500 index rose 45.69, or 5.7 percent, to 843.39.

The advance was a dramatic departure from the sharp selling that has plagued the market since mid-May as pessimism growing out of the accounting and ethics problems overshadowed an improving economy and healthier earnings reports. Triple-digit drops in the Dow have become the norm the blue chips lost 840 points over the previous four sessions alone.

But most analysts said the buying was an expected rebound following significant declines. Bill Barker, an investment strategy consultant at RBC Dain Rauscher in Dallas, said technical factors played a major role in the rally Wednesday as many traders were forced to buy back stock that they had sold short. In short trades, investors sell borrowed stock, expecting the market to fall; when the market then rises, they are forced to buy stock to pay back the debt.

“I think the market is increasingly being dominated by short-term traders,” Barker said. “We need to convince investors that corporate America is not crooked.”

This process, called short covering, creates upward momentum because the higher stocks go, the more traders with shorts have to buy stock.

However, Barker noted that it was very interesting that the market began to rally shortly after the arrests of the founder of Adelphia and his two sons were reported. The accounting scandal at Adelphia has been one of several that have been weighing on market sentiment.

“The market has been waiting for this,” Alan Ackerman, vice president at Fahnestock & Co., said of the Adelphia arrests. “We have a big turnaround in process, but whether it will last or not is a big question. Some of this is based on the fact that the House and Senate appear to have made progress on corporate reforms.”

Some companies were rewarded for positive earnings reports Wednesday. Reebok blew away analysts’ estimates of 30 cents per share by 9 cents a share, and its stock was up $2.13 at $25.44.

DuPont was also up after reporting it swung to a profit in the second quarter, despite falling sales, after posting several charges last year. The chemical maker rose $3.23 to $40.28.

Bargain hunting among stocks that have fallen sharply in recent weeks also helped. J.P. Morgan Chase rose $3.22 to $23.30, while Citigroup rose $2.59 to $29.59. Both stocks were pummelled Tuesday on concerns the banks would suffer from the Enron fallout.

Microsoft, which had pulled back in recent sessions as investors shunned stocks, climbed $3.22, or 7.5 percent, to $46.23. Intel soared 89 cents, or 5 percent, to $18.70.

Advancing issues outnumbered decliners by more than 3 to 2 on the New York Stock Exchange.

It was the busiest day ever on the NYSE. Volume came to 2.74 billion shares, compared with 2.43 billion Tuesday.

As the market tumbled the past two months, major indicators have fallen to levels not seen in at least four years.

On Tuesday the S&P 500, a broad index of major blue-chip companies, closed below 800 for the first time since April 1997. The Dow has fallen to its lowest close since October 1998 and the Nasdaq has dropped to its lowest close since May 1997.

The Russell 2000 index was up 14.57, or 4 percent, Wednesday to 378.56.

Overseas, Japan’s Nikkei stock average fell 2.6 percent. In Europe, stocks were mixed. Germany’s DAX index rose 3.3 percent, recovering from a steep drop earlier. Britain’s FTSE 100 fell 2.1 percent, and France’s CAC-40 lost 1.5 percent.