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NEW YORK -- Stock and bond prices soared today after Federal Reserve Chairman Alan Greenspan hinted at interest rate cuts, and the protracted fight for the White House appeared to be drawing to an end. Stocks, bonds
in powerful rallyAssociated Press
The Nasdaq rose 274.05 to 2,889.80, or 10.48 percent. It was the Nasdaq's highest one-day percentage and point gains ever. The Dow picked up 3.2 percent, rising 337.77 to 10,898.72, its third-largest one-day point gain. The Standard & Poor's 500 index was up 51.57 at 1,376.54, a 3.9 percent increase.
Advancers beat decliners more than 2-to-1 on the New York Stock Exchange, with 2,076 up, 841 down and 416 unchanged. NYSE volume came to 1.39 billion shares, well ahead of the 1.1 billion yesterday. The Russell 2000 index rose 20.78 to 471.17. The NYSE composite index gained 15.86 to 653.27; and the American Stock Exchange composite rose 6.94 at 864.02.
The 10-year Treasury note's price was up 30/32 point, or $9.38 per $1,000 in face value, at midday; its yield fell to 5.42 percent from 5.51 percent late yesterday. Prices and yields move in opposite directions. The 30-year bonds gained 1 20/32 point and yielded 5.58 percent, down from 5.66 percent late yesterday.
Greenspan weaved his magic when he said the Fed had to be alert to the possibility of "excessive softening" in the U.S. economy -- indicating a willingness to contemplate lower interest rates.
"It's very rare that we see him be as clear as he was today," said Charles Lemonides, chief investment officer at M&R Capital Management. "The Fed has said basically they're very cognizant of impact all the tightening has had . . . and now the risks are on the other side," he said.