Spring Break
Stocks move higher after 5 days of heavy selling
Associated Press
Issue date: 3/4/09 Section: News
NEW YORK (AP) - The stock market is showing some signs of life as investors find a few glimmers of hope for an economic turnaround.
The market rallied Wednesday after a week of heavy selling on word of a possible Chinese economic stimulus package and an Obama administration plan to help struggling homeowners. A slightly better-than-expected report on the services sector also helped push stocks higher. All the major indexes rose more than 1.5 percent.
The market's advance was not surprising following a week of unrelenting selling that has left the major indexes down at levels not seen in more than a decade.
"Virtually everyone was expecting some sort of a bounce, we just didn't know exactly when that would occur," said Randy Frederick, director of trading and derivatives at Charles Schwab. "You can't go down forever."
Still, the market's tone was more positive. Investors were encouraged by details of a government program designed to help as many as 9 million borrowers stay in their homes through refinanced mortgages or loans that are modified to lower monthly payments.
Wall Street also took a cue from overseas markets, which rallied amid optimism over a possible Chinese economic stimulus plan. Prices for oil and other commodities climbed amid the enthusiasm over China.
Meanwhile, the Institute for Supply Management, a trade group of purchasing executives, said its services index fell to 41.6 last month from 42.9 in January. The number was slightly above Wall Street's estimate of 41. Any reading above 50 signals growth, while a reading below 50 indicates contraction.
Investors also are awaiting the Federal Reserve's beige book, an assessment of the economy by region, to be released later Wednesday.
In midday trading, the Dow Jones industrial average rose 134.68, or 2.00 percent, to 6,860.70. The Standard & Poor's 500 index added 13.86, or 1.99 percent, to 710.19, while the Nasdaq composite index gained 31.03, or 2.35 percent, to 1,352.04.
Copyright 2009 The Associated Press.
The market rallied Wednesday after a week of heavy selling on word of a possible Chinese economic stimulus package and an Obama administration plan to help struggling homeowners. A slightly better-than-expected report on the services sector also helped push stocks higher. All the major indexes rose more than 1.5 percent.
The market's advance was not surprising following a week of unrelenting selling that has left the major indexes down at levels not seen in more than a decade.
"Virtually everyone was expecting some sort of a bounce, we just didn't know exactly when that would occur," said Randy Frederick, director of trading and derivatives at Charles Schwab. "You can't go down forever."
Still, the market's tone was more positive. Investors were encouraged by details of a government program designed to help as many as 9 million borrowers stay in their homes through refinanced mortgages or loans that are modified to lower monthly payments.
Wall Street also took a cue from overseas markets, which rallied amid optimism over a possible Chinese economic stimulus plan. Prices for oil and other commodities climbed amid the enthusiasm over China.
Meanwhile, the Institute for Supply Management, a trade group of purchasing executives, said its services index fell to 41.6 last month from 42.9 in January. The number was slightly above Wall Street's estimate of 41. Any reading above 50 signals growth, while a reading below 50 indicates contraction.
Investors also are awaiting the Federal Reserve's beige book, an assessment of the economy by region, to be released later Wednesday.
In midday trading, the Dow Jones industrial average rose 134.68, or 2.00 percent, to 6,860.70. The Standard & Poor's 500 index added 13.86, or 1.99 percent, to 710.19, while the Nasdaq composite index gained 31.03, or 2.35 percent, to 1,352.04.
Copyright 2009 The Associated Press.
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