Dow ends up 52 on hopes for wider bailout powers
The Dow Jones industrial average closed up 52 points Tuesday after a report that European leaders were considering more aggressive programs to bail out weaker countries in the region.
The Dow Jones industrial average closed up 52 points Tuesday after a report that European leaders were considering more aggressive programs to bail out weaker countries in the region.
Broader market indicators were mixed. The S&P 500 index rose 1 point and the Nasdaq composite edged lower. Materials and health-care companies rose the most. The agricultural-supplies company Monsanto Co. gained 2.8 percent; drugmaker Pfizer Inc. added 2 percent.
Stocks were stuck in neutral for most of the day after Standard & Poor's said it might downgrade the AAA rating of Europe's bailout fund. A report in the Financial Times late in the afternoon sent the Dow up as many as 117 points. The newspaper reported that European leaders were considering making more financial aid available to struggling countries.
Investors remain cautious ahead of a summit of European leaders Thursday and Friday where the main task will be coming up with credible plans for preventing a simmering debt crisis from causing a breakup of the euro, the currency shared by 17 European nations. Such a shock would likely cause a deep recession in Europe that would spread through the world economy.
The Dow Jones industrial average closed up 52.30 points, or 0.43 percent, at 12,150.13. Among its top performers was 3M Co., which rose 1.5 percent after the maker of Post-It notes forecast 2012 earnings that were stronger that many analysts expected.
The Standard & Poor's 500 index closed up 1.39 points, or 0.11 percent, to 1,258.47. The Nasdaq composite average closed down 6.20, or 0.23 percent, at 2,649.56.
U.S. stock indexes have risen sharply from the lows they hit during a Thanksgiving-week drubbing.Late Monday, S&P said it might downgrade the debt of 15 countries that use the euro. The announcement, and S&P's follow-up statement Tuesday about possibly downgrading the European bailout fund, halted a rally in European markets.
The impact on the market was muted, said Robert Tipp, chief investment strategist with Prudential Fixed Income, because investors are coming around to the view that the European debt crisis may be through its worst phase.