New York: US stocks rose in a choppy session on Wednesday after lawmakers reached a compromise deal on a $789 billion stimulus package that is seen as crucial to reviving the recession-hit economy.
Senate majority leader Harry Reid said differences have been bridged between the two versions of the package that had been passed by the House of Representatives and the Senate, and that votes on the final bill could come as early as Thursday.
“The fact they were able to compromise was sufficient to get the market to take a breath after yesterday. That I think is what helped turn the market around.”
Stocks had see-sawed during the day, hurt by falling crude oil prices and declines in technology shares before finally holding gains on the stimulus package.
Bank shares, which had traded higher throughout the day as bargain-hunters moved in after Tuesday’s 14% sell-off, added to gains on hopes the stimulus package will reinvigorate the economy. The KBW bank index rose 6%.
The Dow Jones industrial average gained 50.65 points, or 0.64%, to 7,939.53. The Standard & Poor’s 500 Index climbed 6.58 points, or 0.80%, to 833.74. The Nasdaq Composite Index added 5.77 points, or 0.38%, to 1,530.50.
The Dow is up 6.6% from its 21 November low while the S&P is up 12.5%. The blue-chip index is down 0.8% for the month and 9.5% year-to-date.
JPMorgan Chase was among the Dow’s biggest lifts, rising 6 percent to $26.09, while the S&P financial index gained more than 5%.
Gains on the Nasdaq were capped as tech stocks were hit by a disappointing profit outlook from Research in Motion and a loss from graphic chipmaker Nvidia Corp that was greater than expected, highlighting the slowdown in both business and consumer spending.
Exxon Mobil was the top weight on the Dow, falling 2.1% as crude oil futures tumbled more than 4%, weighed down by a large increase in domestic crude inventories last week and a gloomy oil demand forecast from the International Energy Agency.
Advancers outnumbered decliners on the NYSE by a ratio of about 3 to 2, while on the Nasdaq, about 5 stocks rose for every 4 that fell.