Stocks End Up On Volatile Day
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An early rally on strong results from HP turned negative on Tuesday before stocks recovered to close in positive territory.
The major indexes were up more than 1% in the first 90 minutes of trading before 25% losses in shares of Freddie Mac and Fannie Mae caught up with the market. At their lows, the indexes were down nearly as much as they had been up before they recovered to end the day with modest gains.
Also moving stocks was a Federal Reserve outlook that predicted economic weakness and lower inflation, yet the October Fed meeting minutes released at the same time showed reluctance to cut interest rates last month. After initially sending stocks lower, traders decided that the outlook gave the Fed room to cut interest rates possibly even an emergency rate cut which helped the market recover off its lows.
HP ended the day little changed despite results and guidance that beat Wall Street expectations.
Google gained 3.6% to $648.54 after Credit Suisse set a $900 price target on the stock, and Research In Motion, Apple, Microsoft and Intel were other big-cap tech gainers.
Ericsson plunged 12% on a warning, and AMD and Palm fell on negative analyst comments.
Blue Coat surged 12% on results that topped analysts' forecasts.
EchoStar fell 9% a day after surging 19% on reports that it could be acquired by AT&T.
The Nasdaq rose 3 to 2596, the S&P gained 6 to 1439, and the Dow rose 52 to 13,010. Volume rose to 4.8 billion shares on the NYSE, and 2.61 billion on the Nasdaq. Decliners led by a 17-16 margin on the NYSE, and 17-12 on the Nasdaq. Downside volume was 53% on the NYSE, and 55% on the Nasdaq. New highs-new lows were 41-614 on the NYSE, and 51-413 on the Nasdaq.