Stocks extend gains amid positive signs
NEW YORK » Wall Street scored its second straight big advance yesterday after economic figures suggested the job market is holding up and as lawmakers promised measures that could ease concerns about consumer spending.
The Dow Jones industrials rose more than 100 points, bringing its two-day gain to more than 400.
While stocks fluctuated throughout the session, trading was decidedly more calm than Wednesday, when Wall Street executed a stunning turnaround that transformed a sharp sell-off into big gains for stocks.
In addition, the market wobbled during the session after Fitch Ratings lowered its rating on bond insurer Security Capital Assurance Ltd. Bond insurers have been hurt in the fallout from the mortgage and credit crises, and news of their problems has shaken the market.
After the Fitch downgrade, Security Capital fell $1.16, or 30.6 percent, to $2.63.
But those seeking good news found some in a U.S. Labor Department report that said the number of people seeking unemployment benefits last week fell for a fourth straight week. Applications for benefits dropped 1,000 to 301,000, pushing claims down to the lowest level in four months.
Investors also appeared pleased by a widely anticipated agreement between Congressional leaders and the White House on an economic stimulus package.
Bill Dwyer, chief investment officer at MTB Investment Advisors in Baltimore, said the Federal Reserve's decision to lower interest rate this week could also help some struggling homeowners hold onto their properties. The efforts, he said, could ultimately help stave off recession.
"People have that 'R' word stuck on the front of their forehead. It's really just a dramatic slowing of growth. We may not have a recession," Dwyer said.
The Dow Jones industrial average rose 108.44, or 0.88 percent, to 12,378.61, following a nearly 300 point surge Wednesday.
The Dow has not finished higher for two straight sessions since Jan. 9-10.
Broader stock indicators also rose. The Standard & Poor's 500 index rose 13.47, or 1.01 percent, to 1,352.07, and the Nasdaq composite index advanced 44.51, or 1.92 percent, to 2,360.92.
The Russell 2000 index of smaller companies dipped 0.71, or 0.10 percent, to 692.72.
Advancing issues outnumbered decliners by 4 to 3 on the New York Stock Exchange, where volume came to 2.18 billion shares.
The Dow swung 631.86 points Wednesday from its low point to its high -- its largest single-day reversal in more than five years.
Bond prices fell as stocks rose. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.67 percent from 3.55 percent late Wednesday. The dollar was mixed against other major currencies, while gold prices rose.
Light, sweet crude oil for March delivery rose $2.42 to settle at $89.30 a barrel on the New York Mercantile Exchange after the agreement on the economic stimulus plan. Traders wagered the plan to put money in consumers' pockets could increase demand for oil.