US rescue plan boosts Wall Street
Issued on: Modified:
After good results on the European markets, Wall Street is continuing to gain, boosted by Obama's speech on a rescue plan. The Dow Jones rose 2.45 percent, while the Nasdaq went up 3.55 percent.
AFP - US stocks rallied Wednesday amid optimism US President Barack Obama was moving swiftly to rescue loss-ridden banks and jolt the economy from recession.
The market also took in stride the outcome of a Federal Reserve meeting which left key lending rates near zero and offered the prospect of more central bank intervention in the bond market to revive credit.
The Dow Jones Industrial Average vaulted 201.27 points (2.46 percent) to 8,376.00 at the closing bell for a third consecutive day of gains.
The tech-heavy Nasdaq jumped 53.44 points (3.55 percent) to 1,558.34 and the broad-market Standard & Poor's 500 index advanced 28.41 points (3.36 percent) to a preliminary close of 874.12.
Market confidence stemmed from reports that Obama was pushing for a "bad bank" to isolate toxic assets from the banking system reeling largely from a massive home mortgage meltdown.
"The 'bad bank' plan for ridding banks of their toxic assets is gaining adherents, and that is likely to be credited for today's stock market rally," said Liz Ann Sonders, chief investment strategist at Charles Schwab & Co.
"The bad bank structure could allow the government to rewrite some of the mortgages that sit under banks' toxic assets, while some lenders could be taken over by regulators and some management teams could be on their way out. This would be to provide some protection for taxpayers."
Daily newsletterReceive essential international news every morningSubscribe