Bloomberg: U.S. stocks rose for the first time in three days as investors speculated the Federal Reserve will lower interest rates after unemployment surged, General Motors Corp. warned it is running out of cash and pending home sales dropped.
Exxon Mobil Corp., the biggest oil company, climbed 6.3 per cent and Alcoa Inc., the nation’s largest aluminium producer, rallied 9.1 per cent as traders bet the Fed will cut the benchmark rate to 0.5 per cent at its meeting on Dec. 16. GM, the biggest automaker, lost 9.2 per cent. U.S. stock indexes briefly pared gains in the final hour of trading after Barack Obama said there is no quick fix for the economy.
…The Standard & Poor’s 500 Index added 26.11 points, or 2.9 per cent, to 930.99. The gauge trimmed its weekly decline to 3.9 per cent. The Dow Jones Industrial Average climbed 248.02, or 2.9 per cent, to 8,943.81 after losing almost 10 per cent in the previous two days. The Nasdaq Composite Index increased 2.4 per cent to 1,647.4. Three stocks advanced for each that fell on the New York Stock Exchange.
The Dow and S&P 500 recovered after the steepest two-day declines since 1987 wiped out more than half of the market’s rebound from a five-year low on Oct. 27. The S&P 500 slumped 37 per cent this year on concern almost $700 billion in credit losses and writedowns at financial firms worldwide will push the global economy into recession.
…The U.S. jobless rate climbed in October to 6.5 per cent, the highest level since 1994, and payrolls dropped by 240,000 workers, signaling the economic slump inherited by Barack Obama will last well into his first year as president.
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