Investors added $598.6 billion to mutual funds that purchase debt in the two years ended March 31, compared with $30.6 billion for equities, according to Washington-based Investment Company Institute data. The S&P 500 has gained 110% including dividends in the past 26 months, data compiled by Bloomberg show.

"It is a positive symbolic gesture for U.S. leadership, and Barack Obama in particular," said O'Neill, of Goldman Sachs Group Inc. "Of course, beyond this immediate reaction, markets need to be careful as bin Laden has possibly not been the single biggest security threat directly for many years, and those who will regard him as a martyr won't give up as a result of his killing."

Investors are enjoying the biggest bull market in 54 years after 76% of S&P 500 companies beat first-quarter earnings projections as the economic recovery continued. Gross domestic product expanded 1.8% in the first quarter. It will rise 3.2% this quarter, and accelerate through the end of the year, according to the median of economists' estimates compiled by Bloomberg.

Longest Streak

The S&P 500 has risen eight straight months when dividends are included, matching its longest streak since 1995, data compiled by Bloomberg show. Gains have come as Obama's Democrats in Congress struggle to find common ground with opposition Republicans on how to reduce the fiscal deficit. U.S. government debt has more than doubled to a record since the 2001 attacks to $14.3 trillion, partly due to spending on military actions in Afghanistan and Iraq.

The rally has driven the VIX, the benchmark index for U.S. stock options that measures the cost of using them as insurance against declines, to three-year lows. The Chicago Board Options Exchange Volatility Index, as the index is known, fell to 14.62 on April 28, the lowest close since June 2007 and a drop of 50% since this year's peak of 29.40 after Japan's earthquake. It rose 8.4% to 15.99 yesterday, below its 20.36 average during its two-decade history.

VIX At 40

"Had this happened in 2009 when the VIX was at 40, we might have seen the market rally 5% and the VIX be down 5 points," said Jeremy Wien, head of VIX options trading at Peak6 Capital Management LLC in Chicago. "You can't have that here because of where we are. The VIX is already at a level that's so low compared to recent years that it would be hard for it to come in too much more."

Bin Laden's killing put American and allied officials on guard against possible reprisals as they vowed to maintain the fight against terrorism. CIA Director Leon Panetta said yesterday in a message to agency employees that bin Laden's death "struck a heavy blow" against al-Qaeda, even as he warned that terrorists "almost certainly will attempt to avenge" the killing.

Eliminating the terror group's leader doesn't affect the rate of expansion in the economy or company profits and won't make North America or Europe any safer, said billionaire investor Kenneth Fisher, who oversees $45 billion at Woodside, Calif.-based Fisher Investments Inc.