US stocks rise after two days of heavy selling
Buyers returned to Wall Street after two days of heavy losses, mindful of the economy's growing problems but attracted by stocks' lower prices.business Updated: Nov 08, 2008 10:37 IST
Buyers returned to Wall Street after two days of heavy losses, mindful of the economy's growing problems but attracted by stocks' lower prices.
Analysts said the advance, which also came amid relief that a bad report on unemployment wasn't worse and followed dour third-quarter reports from Ford and General Motors, was to be expected as Wall Street experiences a rocky recovery from October's devastating selling.
The major indexes jumped more than 2 per cent on Friday, including the Dow Jones industrial average, which rose nearly 250 points in light trading. For the week, the Dow and broader benchmarks like the Standard & Poor's 500 index lost about 4 per cent after surging 10 per cent or more last week.
Friday's trading was a mini-version of the market's performance over the past two weeks, with investors upbeat, then realizing there was little basis in reality for their resurgent confidence, then changing their minds again.
The market briefly came off its highest levels of the session after President-elect Barack Obama reiterated at a news conference that there is a great deal of hard work to be done to restore the economy to health. Investors had optimistically sent prices higher, only to temporarily pull back when Obama underscored what they already know: that the economy's problems won't be easily solved.
George Shipp, chief investment officer at Scott & Stringfellow, said Obama appeared to be trying to telegraph to the market not to expect too much immediately.
Obama, noting that he has until January before taking office, said he will work to support an economic stimulus plan and will seek ideas for helping the auto industry.