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NEW YORK: US stocks closed modestly higher on Wednesday in choppy trade as the market was able to shrug off growing concerns about several countries' debt and the fragile global economic recovery.
After a weak opening, the Dow Jones Industrial Average rose 51.08 points (0.50 percent) to 10,337.05.
The Nasdaq composite climbed 10.74 points (0.49 percent) to 2,183.73 and the broad-market Standard & Poor's 500 index advanced 4.01 points (0.37 percent) to 1,095.95.
"Global worries sent US stocks lower when markets opened this morning, but the weaker US dollar and brighter prospects for private health insurers improved sentiment by the close," said Sara Kline at Moody's Economy.com.
Insurers were helped by news that US congressional leaders were abandoning a public option for health care, which would boost the private carriers.
The major indices swung in and out of negative territory "as traders grapple with determining the impact of debt woes in Dubai, Greece, and Spain on the economic recovery," Charles Schwab & Co. analysts said in a note to investors.
Stocks slid at the opening bell as US Treasury Secretary Timothy Geithner announced he had extended the authority of the 700-billion-dollar Troubled Asset Relief Programme financial bailout to October 3, 2010, that had been set to expire December 31.
Geithner said many of the TARP programmes will be wound down but that the economy and financial system have not fully recovered from the near-meltdown of 2008.
"It paints a picture of the marketplace that is still under enough strain that the Treasury feels the need to continue to provide supportive capital to finance markets," said Craig Peckham of Jefferies.
"We get a little bit of a reminder, at least in the US, that the state of affairs is still stable, a bit on the fragile side," the analyst added.
Investors also digested international ratings agency Standard & Poor's downgrade of Spain's sovereign debt, to negative from stable, that added to concerns about the solvency of Dubai and Greece.
Among stocks in focus, Dow component 3M rebounded from the prior day's loss after the industrial group issued a disappointing outlook. Boosted by a Citigroup upgrade to "buy," 3M surged 3.41 percent to 79.75 dollars.
Bank of America slipped 0.13 percent to 15.39 dollars. The largest US bank by assets announced in afternoon trading on Wall Street that it had repaid the entire 45 billion dollars in TARP public aid to the Treasury, after raising more than 19 billion dollars in capital last week.
Citigroup, which reportedly is trying to negotiate its exit from the TARP, fell 1.28 percent to 3.86 dollars.
Kraft Foods edged up 0.19 percent to 26.71 dollars after the European Union extended its probe into Kraft's hostile takeover bid for British confectionery group Cadbury to January 6, from the prior December 14 deadline.
In the tech space, Texas Instruments slid 1.29 percent to 25.99 dollars after raising its 2009 fourth-quarter earnings and revenue outlook less than most analysts expected.
Time Warner gained 2.35 percent at 31.37 dollars after finalising the spin-off of its Internet unit AOL, which begins trading on the New York Stock Exchange on Thursday.
Bonds fell back. The yield on the 10-year Treasury bond rose to 3.423 percent from 3.392 percent on Tuesday and that on the 30-year bond advanced to 4.408 percent from 4.380 percent. Bond yields and prices move in opposite directions. - AFP/de
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