After a Three-Day Rout, Stocks Surge Wednesday

By: From CNN Money
By: From CNN Money

NEW YORK (CNNMoney) -- Stocks rallied right out of the gate and picked up steam through the day to end sharply higher Wednesday. The gains came as concerns over Europe's debt crisis eased and investors geared up for President Obama's highly anticipated jobs speech Thursday evening.

The Dow Jones industrial average surged 276 points, or 2.5% on Wednesda. All 30 of the blue-chip index's components posted gains. The S&P 500 (SPX) added 33 points, or 2.9%, and the Nasdaq Composite (COMP) jumped 75 points, or 3%.

Stocks got off to an ugly start in September, with all three indexes declining more than 4% during the first three trading days of the month, amid fears about Europe's money troubles and a stalling economic recovery in the United States.

After Wednesday's broad advance, the indexes are down just 1% for the month.

The renewed optimism came on the back of solid gains in stock markets around the world, after a German court ruling rejected lawsuits intended to block Germany's involvement in providing other eurozone members with bailout packages.

"The court ruling confirms German Chancellor Angela Merkel's ability to help bail out Europe's troubled areas, and that provides a great amount of confidence that we will see some sort of solution in Europe soon enough," said Brian Battle, director with Performance Trust Capital Partners.

But the court's decision also said that the German parliament must have a greater say in the decisions, which could slow the process.

Investors are also preparing for President Obama to unveil a new $300 billion jobs proposal Thursday evening aimed at stimulating the stagnant labor market.

While details of the plan are limited ahead of the speech, Battle said investors will be listening for measures that haven't been "pre-announced."

"There are a number of things investors are already anticipating, and they're hoping that the president will also have some sort of a surprise -- maybe more tax cuts or help for homeowners -- but it's hard to say," Battle said.

Jobs are clearly on investors' minds, especially following last week's dismal government report that showed zero job growth in August -- stoking fears of another recession.

U.S. stocks fell Tuesday, extending last week's losses, as the long-running debt crisis weighed on investor sentiment.

Economy: It's been a rough few weeks for investors as stocks have been quick to react to a series of mixed economic reports. That's resulted in a roller-coaster ride that doesn't seem to be ending anytime soon.

"Investors will be reacting to every headline, day by day," Battle said.


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