WORLD> America
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WORLD> America
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Wall Street surge; credit worries persist
(Agencies)
Updated: 2008-10-01 09:14 Critics of the bailout package believe that it was too costly and wouldn't have done enough to jump-start lending. To maintain pressure ahead of Thursday's likely vote, President Bush said in a statement from the White House early Tuesday that the damage to the economy will be "painful and lasting" unless Congress passes the bailout measure. On Wall Street, many traders likely will proceed cautiously while they gauge prospects for resurrecting the bailout effort, which was backed by leaders of both parties.
"I'm not getting the sense that investors are going to be jumping in with both feet until there is some kind of resolution on the plan," said James Maguire, an NYSE floor trader with Christopher J. Forbes. "If there's a no vote, we're going to see a lower overall drift in stocks. It will be a slow bleed." Tuesday marked the final session of the third quarter -- and what is typically the worst month for the stock market -- so some portfolio managers might have been eager to dress up their performance. The Dow rose 485.21, or 4.68 percent, to 10,850.66 after falling nearly 7 percent on Monday to its lowest close in nearly three years. It was the largest point drop and 17th largest percentage drop in the blue chip index. The percentage decline was far less severe than the 20-plus-percent drops seen in the stock market crash of October 1987 and before the Great Depression. Broader stock indicators also bounced higher. The Standard & Poor's 500 index recovered 58.35, or 5.27 percent, to 1,164.74, and the Nasdaq composite index rose 98.60, or 4.97 percent, to 2,082.33. The S&P fell 8.79 percent Monday, while the Nasdaq lost 9.14 percent. The yield on the 3-month Treasury bill rose Tuesday to 0.89 percent from 0.14 percent late Monday. The yield fell Monday as investors clamored for the safety of government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.83 percent from 3.58 percent late Monday. The dollar rose against other major currencies and gold prices advanced. While investors focused on what might come from Washington this week, Wall Street was cheered by several economic readings. A private research group reported that consumer confidence rose unexpectedly in September. The Conference Board said Tuesday its Consumer Confidence Index rose to 59.8 from a revised 58.5 in August; Wall Street had expected a reading of 55.5, according to Thomson/IFR. The reading, which doesn't reflect attitudes following Monday's steep stock market sell-off, remains near a 16-year low. The Chicago Purchasing Managers' index, which measures business conditions across Illinois, Michigan and Indiana, came in at 56.7 compared with 57.9 in August -- a second straight month of a strong reading. Light, sweet crude rose $4.27 to settle at $100.64 on the New York Mercantile Exchange. Oil fell more than $10 a barrel Monday as investors worried that a weaker economy would curtail demand. Advancing issues outnumbered decliners by about 2 to 1 on the New York Stock Exchange, where volume came to 5.84 billion shares by the closing bell. The Russell 2000 index of smaller companies rose 21.86, or 3.32 percent, to 679.58. Overseas, Japan's Nikkei stock average fell 4.12 percent. But Hong Kong's Hang Seng index rose 0.76. Britain's FTSE 100 rose 1.74 percent, Germany's DAX index added 0.41 percent, and France's CAC-40 rose 1.99 percent. |
