By Anna Isaac and Alexander Osipovich

The Dow Jones Industrial Average rose more than 480 points Monday, clawing back some lost ground after four consecutive weeks of declines, as investors piled into economically sensitive stocks including those of banks and energy companies.

Monday's gains were broad, with 29 of the 30 stocks in the blue-chip index rising, along with all 11 sectors of the S&P 500. The rally was a welcome relief for investors, who said last week's selloff was overdone.

JPMorgan Chase and Goldman Sachs Group were both up more than 2.5%, while Chevron climbed more than 3% as investors snapped up beaten-down stocks outside the high-flying technology sector.

"There's been a lot of froth in markets recently that has been washed out," said Hani Redha, a portfolio manager at PineBridge Investments, who said the economy is in the early stages of a multiyear expansion. "It will remain volatile in the coming weeks, but overall the trend will remain upward."

The Dow was up 1.7% in afternoon trading. The S&P 500 gained 1.8%, while the tech-heavy Nasdaq Composite climbed 1.7%.

The financial and energy sectors, which tend to be sensitive to economic trends, were the best-performing sectors of the S&P 500, both rising about 2.5%.

Thomas Hayes, chairman of investment-management firm Great Hill Capital, said his firm had bought shares of Wells Fargo and other banks in recent days. He expects such stocks to fare better than the tech stocks that drove the market's rally from March to September.

"That's where you're going to outperform, with the things that have been left behind so far," he said. Cyclical stocks like banks tend to beat the broader market during recoveries from recessions, he added.

September has been a turbulent month for stocks, with declines in tech stocks pulling down major indexes. Apple has dropped 11% since the start of the month, while Amazon.com has slumped 8.3% and electric-car maker Tesla has slid 16%.

Even so, such stocks have enjoyed an extraordinary run-up this year, thanks to profits that have remained resilient during the coronavirus pandemic and a sense that Big Tech will benefit as more Americans continue working from home. Apple is up 56% for the year, while Amazon is up 71%. Tesla's stocks has roughly quintupled in 2020.

Markets have been turbulent in recent weeks due to investors' concerns about rising or elevated levels of coronavirus infections, the uneven pace of economic recovery, political risks and tensions between Beijing and Washington. The Cboe Volatility Index, a measure of expected swings in the S&P 500, inched higher on Monday.

Traders are betting on one of the most volatile U.S. election seasons on record, wagering on unusually large swings in everything from stocks to currencies. Investors are scooping up a variety of investments that would pay out if volatility extends far beyond Election Day itself, concerned that the outcome of the presidential contest could remain unclear into December.

"It's a very different environment than that we've seen for any other election," said James McCormick, a strategist at NatWest Markets. "As an investor, you have to protect yourself because you just don't know how this is going to swing."

In corporate news, shares of Devon Energy jumped 13% on Monday after The Wall Street Journal reported and the company later confirmed a merger agreement with WPX Energy. The move could help the two companies weather a prolonged industry slump. WPX's stock rallied 18%.

Uber shares gained 3.8% after the ride-hailing company won an appeal over the revocation of its operating license in London, ending for now a yearslong tussle with regulators in one of its biggest global markets.

Overseas, the pan-continental Stoxx Europe 600 rose 2.2%. In Asia, most major benchmarks ended the day in positive territory. Japan's Nikkei 225 Index rose 1.3%, while Hong Kong's Hang Seng rose 1%.

In bond markets, the yield on the benchmark 10-year Treasury note inched up to 0.663%, from 0.659% on Friday.

Futures on Brent crude, the global oil benchmark, rose 1.2% to settle at $42.43.

Write to Anna Isaac at anna.isaac@wsj.com and Alexander Osipovich at alexander.osipovich@dowjones.com