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Wall Street pulls off a final-hour rebound

The S&P 500 index nears a 2003 low but Hewlett-Packard's strong outlook helps buoy investors.

November 19, 2008|ASSOCIATED PRESS

NEW YORK — Wall Street rebounded Tuesday in another turbulent session after the Standard & Poor's 500 index neared a 2003 low.

Investors drew some encouragement from Hewlett-Packard's prediction that its fourth-quarter and 2009 results would easily exceed Wall Street expectations.

But still underpinning the market were concerns that the economy was in a recession that could be the worst in more than two decades. A record plunge in wholesale prices last month and an all-time low reading of home builder sentiment only bolstered those fears.

The Dow Jones industrial average rose 151.17 points, or 1.8%, to 8,424.75.

Broader indexes had smaller gains. The Standard & Poor's 500 index rose 8.37 points, or 1%, to 859.12, after drifting toward its 2003 low of 818.69. The Nasdaq composite index rose 1.22 points, or 0.1%, to 1,483.27.

But declining issues narrowly beat advancers on the New York Stock Exchange on light volume. And the Russell 2,000 index of smaller-company stocks fell 0.8%.

For the major indexes, Tuesday's advance was only the second in the last seven days.

The uncertainty on Wall Street kept Treasury securities in high demand.

The three-month T-bill, considered one of the safest assets around, fell to 0.11% from 0.15% on Monday.

Yields that low suggest that investors are willing to earn virtually nothing on their investments as long as their principal is preserved.

The benchmark 10-year note fell to 3.53% from 3.66% on Monday.

Analysts warned against taking Tuesday's gain as a sign that the stock market was ready to stage a recovery. "There is no enthusiasm on the buy side right now," said Joe Keetle, senior wealth manager at Dawson Wealth Management. Financial stocks in the S&P 500 fell 0.8% as a group despite an assertion by Treasury Secretary Henry M. Paulson on Capitol Hill that the U.S. had "turned a corner" in averting a financial collapse.

Shares of General Motors and Ford Motor fell as their executives, along with envoys from Chrysler and the United Auto Workers, took their quest for $25 billion in government aid to the Senate Banking Committee.

Such assistance has the backing of Democratic congressional leaders, but the Bush administration and Republican lawmakers oppose it.

Ford shares fell 4 cents to $1.68; GM shares fell 9 cents to $3.09.

In the technology sector, Hewlett-Packard vaulted $4.25, or 14%, to $33.59 after its revised outlook suggested the world's largest maker of personal computers was weathering the economic crisis that is hurting sales at other tech companies.

Yahoo shares surged 92 cents, or 8.7%, to $11.55 after founder Jerry Yang announced that he was stepping down as chief executive. Many analysts said the departure would accelerate an overhaul of Yahoo and possibly lead to a sale of the company.

The dollar fell against most other major currencies. Gold prices also fell.

Oil prices fell for the fifth time in six days.

Crude futures slid 56 cents to $54.39 a barrel.

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