Dow closes up nearly 400 points
NEW YORK (AP) - April 1, 2008 Financial stocks were among the big winners after Lehman Brothers Holdings Inc. and Switzerland's UBS AG issued new shares to help bolster their balance sheets. With that upbeat news and a fresh quarter ahead of them, investors appear quite willing to make some bets that the worst of the damage from the nation's credit struggles has been felt. Moreover, the banks' moves buttressed the view that financial services companies are taking aggressive action to improve their capital bases and stave off the potential of a collapse similar to Bear Stearns Cos. Analysts believe there must be a recovery in bank and brokerage stocks to lead major stock indexes higher. Some of the biggest financial players had their biggest moves of the year Tuesday -- Citigroup Inc. shot up 11 percent, JPMorgan Chase & Co. rose 9 percent, and Lehman surged 17 percent. "Investors have a difficult time making decisions about the stock market if they don't have confidence in major financial institutions, so there's been a lot of sideline cash," said Richard Cripps, chief market strategist for Stifel Nicolaus. "The extreme conditions that we've seen here over the past few months has been missing that confidence ... but that appears to be changing, and we're seeing the response." Meanwhile, Wall Street got another boost when the Institute for Supply Management said its March index of national manufacturing activity rose to a reading of 48.6 -- indicating a contraction, but a slower one than in February and tamer than many analysts had predicted. Government data on construction spending for February also came in better than expected. According to preliminary calculations, the Dow rose 391.47, or 3.19 percent, to 12,654.47. Broader stock indicators also gained sharply. The Standard & Poor's 500 index rose 47.47, or 3.59 percent, to 1,370.17, and the Nasdaq composite index rose 83.65, or 3.67 percent, to 2,362.75.
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