NEW YORK, JUNE 3 -- Stocks, bonds and the dollar rallied today as the financial markets began to overcome the pessimism caused by the departure of Federal Reserve Chairman Paul A. Volcker.

The dollar strengthened against major foreign currencies and government bond prices rose in quiet trading. On the New York Stock Exchange, the Dow Jones industrial average surged 42.47 points to 2320.69.

Nevertheless, the markets remained uncertain over how Volcker's successor, conservative economist Alan Greenspan, would affect the conduct of U.S. monetary policy, despite White House contentions that nothing had changed.

"Until people get better fixed on Mr. Greenspan, which would take six months, there will be a lot more market volatility," said Sung Won Sohn, chief economist for Norwest Corp., the Minneapolis-based banking company.

The dollar continued Tuesday's sharp selloff in overnight trading in Tokyo, ending a nine-session rise against the Japanese yen. But later in Europe and New York, the dollar moved higher against most major currencies, although it still finished below the levels it held before the Volcker announcement.

The dollar rose to 143.30 yen late today in New York trading, up from 141.25 at Tuesday's close, and reached 1.8103 German marks, up from 1.7945.

A stronger dollar helped boost bond prices. The bellwether 30-year Treasury bond, down more than $30 per $1,000 in face value in heavy activity on Tuesday, rose more than $16 today.

The volume of stocks traded on the Big Board was 164.5 million, up from 153.4 million Tuesday. Analysts said the relatively light volume reflected investor skittishness about the change at the Fed.

Nevertheless, advancing issues led decliners, 1,100 to 472. Standard & Poor's 500-stock index rose 5.01 to 293.47 and the NYSE composite rose 2.50 to 165.27.

Market analysts said that a number of factors boosted prices today but the key to the rallies was a calming of the frenzy that followed the news Volcker would retire from the Fed.

The Tuesday morning announcement sent the dollar tumbling in foreign exchange markets and sparked a dizzying selloff in bonds. While many traders and analysts had speculated that Volcker would not be reappointed, the announcement still took many by surprise.

"I think it was not so much a reaction to the loss of Volcker, but more a reaction to change," said Lee Hoskins, chief economist for PNC Financial Corp. in Pittsburgh.

The relative lack of information about Greenspan added to the surprise and to speculation on the impact Volcker's departure would have on world markets, where he is regarded as a stabilizing influence and the nation's most powerful inflation fighter.

"The bond market's been nervous about inflation," said PNC's Hoskins. "Paul Volcker is viewed by the bond market as the premier inflation fighter. Any change of Paul Volcker for someone else is bound to be disturbing."

But as the markets had a chance to digest the torrent of information about Greenspan, they gained reassurance. In addition, governments moved to calm worldwide market jitters. Treasury Secretary James A. Baker III, speaking via satellite from Washington to foreign reporters in Montreal, Tokyo and four European cities, said he expected no changes in monetary policy.

In Tokyo, Bank of Japan governor Satoshi Sumita echoed Baker's remarks at a news conference and said he was confident that coordination among the major monetary powers on exchange rate stability would continue.

The markets are expected to resume focusing on the economic summit next week in Venice. Leaders of the United States, Japan, West Germany, Britain, France, Canada and Italy again are expected to seek stability in exchange rates, although economists are divided over the prospect of concrete changes to reach that goal.