New York ? Investors pushed stocks substantially higher Monday as Wall Street greeted the Oracle-PeopleSoft merger and a climb in retail sales as signs of continued economic improvement. The Standard & Poor’s 500 index set a new post-9-11 high.

Oracle Corp. announced that PeopleSoft Inc. would accept a $26.50-per-share bid, valuing the rival software company at $10.3 billion. The agreement ends an 18-month feud between the two that featured courtroom intrigue and pithy public statements, and cheered investors who feared the battle would distract the companies from their core businesses.

Wall Street also applauded the Commerce Department’s report on November retail sales, which rose 0.1 percent, better than the flat sales economists had expected.

“I think the retail sales numbers helped, alleviating a lot of the concern over holiday sales prospects. And then on top of that you have all this merger activity,” said Bryan Piskorowski, market strategist for Wachovia Securities. “Midmonth is typically pretty quiet, but this news is bringing some people back into the market.”

The Dow Jones industrial average rose 95.10, or 0.9 percent, to 10,638.32, the Dow’s best closing level since March 1. Broader stock indicators were strongly higher. The S&P 500 index was up 10.68, or 0.9 percent, at 1,198.68, the best close since Aug. 8, 2001. The Nasdaq composite index gained 20.43, or 0.96 percent, to 2,148.50, near its 2004 high.

Investors also received good news from the Commerce Department’s latest business inventory report. The 0.2 percent rise in inventories for November was less than expected, meaning that demand for goods could be picking up.