NEW YORK - Stocks rose yesterday after investors found solace in the European Central Bank's $500 billion loan issuance, but the possibility of recession in 2008 made for a seesaw session.

The ECB's massive tender bolstered the idea that the world's central banks are working to revive demand in struggling areas of the credit market. The Bank of England also said it would offer additional reserves to lenders yesterday, after the U.S. Federal Reserve on Monday auctioned off $20 billion in credit.

Few are calling the end of the credit crunch just yet, though, and the market's movements yesterday reflected its uncertainty. Alongside U.S. government data showing that new-home construction dropped last month to its lowest rate in more than 16 years, the central banks' actions had a hard time galvanizing a market that remained anxious that the economy had further to fall.

"It's very disconcerting that we're getting central bank interventions for a problem that many were hoping would be a self-contained one," said Joseph V. Battipaglia, chief investment officer at Ryan Beck & Co. Inc.

Meanwhile, cautious comments from the Goldman Sachs Group Inc. and Best Buy Co. Inc. dampened some of the market's enthusiasm over the companies' better-than-expected quarterly earnings.

But after several sessions of declines, the Dow Jones industrial average rose 65.27, or 0.50 percent, to 13,232.47, after gaining as many as 112 points, falling 75 points, and then rebounding.

Broader stock indicators also bounced back from a midday slump. The Standard & Poor's 500 index rose 9.08, or 0.63 percent, to 1,454.98, and the Nasdaq composite index rose 21.57, or 0.84 percent, to 2,596.03.

Each of the three major stock indexes Monday lost at least 1 percent because of concerns that prices could keep rising despite a weakening economy - a phenomenon called stagflation. Stocks have also been volatile because of the "quadruple witching" Friday, when contracts expire for stock index futures, stock index options, stock options and single stock futures.

Goldman Sachs fell $7.12, or 3.41 percent, to $201.51 after releasing its earnings report, which showed a 2 percent profit gain, but uneven results across the investment bank's various units.

Best Buy rose 48 cents to close at $51.62 after the electronics retailer posted a 52 percent profit gain. However, the company issued a forecast that came in below analysts' expectations.

The Russell 2000 index of smaller companies rose 15.00, or 2.03 percent, to 754.06.

The dollar was mixed against other major currencies, while gold prices advanced.

Japan's Nikkei stock average fell 0.27 percent, and Hong Kong's Hang Seng index rose 0.51 percent. Britain's FTSE 100 rose 0.02 percent, Germany's DAX index rose 0.32 percent, and France's CAC-40 fell 0.10 percent.