Down ends up 401 to extend streak of volatility

By: AP
By: AP

NEW YORK (AP) -- Wall Street turned in another stunning finish Thursday and extended its unprecedented streak of volatility - this time, to the upside. The Dow Jones industrials ended up 400 points, after falling 380 in the opening minutes of the session.

It is clear that investors are reacting in the extreme to negative any economic news, including disappointing numbers Thursday on industrial production that initially sent stocks skidding. But traders are also responding to the market's own dynamics, and when there was no late-session plunge, as there was on Wednesday, buyers piled in during the last hour of trading.

Analysts expect this extraordinary volatility to continue, and warned that just as Monday's huge 936-point surge in the Dow was overdone, there was little reason to trust that Thursday's gains would hold.

A rise in shares of Yahoo Inc. over renewed speculation it could cement a deal with one-time suitor Microsoft Corp. helped push the technology-laden Nasdaq composite index up more than 5 percent.

Stocks spent much of the session seeking a direction after Wednesday's steep dive, which took the Dow down 733 points in response to a stream of bad economic news that underscored the likelihood that the country is either in a recession or will be in one - and that the downturn could be severe. There was no news Thursday to counter those fears - but there were plenty of gyrations in stock prices and the major indexes.

"We're going to continue to see volatility. You're not going to see 50-point ranges, you're going to see two-three-four hundred point ranges," said Woody Dorsey, president of Market Semiotics, a financial forecasting firm in Castleton, Vt.

According to preliminary calculations, the Dow rose 401.35, or 4.68 percent, to 8,979.26.

Broader stock indicators also jumped. The Standard & Poor's 500 index rose 38.59, or 4.25 percent, to 946.43, and the Nasdaq composite index rose 89.38, or 5.49 percent, to 1,717.71.

Advancing issues outnumbered decliners by about 2 to 1 on the New York Stock Exchange, where volume came to 2 billion shares.


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