Credit Markets Thaw

May the de-icing begin.

Bloomberg: Stocks rallied and the Dow Jones Industrial Average posted its second-best point gain as the cheapest valuations in 23 years lured investors and increased commercial paper sales signaled credit markets are thawing.

Alcoa Inc. jumped 19 per cent, leading the Dow to an almost 900-point advance, after the shares slid to their lowest price- to-earnings ratio on record. General Electric Co., the largest issuer of commercial paper, soared 9.9 per cent after sales of longer-term debt grew 10-fold yesterday as the Federal Reserve entered the market for corporate IOUs. Citigroup Inc. and Bank of America Corp. rose more than 12 per cent as traders boosted bets the Fed will cut interest rates tomorrow.

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