Saturday, Nov 29, 2008
U.S. stocks gained, capping the biggest weekly advance for the Standard & Poor’s 500 Index in 34 years, on speculation that government bailouts will shore up the economy.
Citigroup Inc., which had $306 billion in troubled assets guaranteed by the government last weekend, rallied 18 percent for its fourth straight gain. General Motors Corp. climbed 8.9 percent and Ford Motor Co. surged 25 percent as the automakers considered cutting debt and labor costs to win federal aid. Target Corp. slumped 3.9 percent as retailers extended discounts to lure shoppers amid what is forecast to be the slowest holiday shopping season in six years.
“It’s going to be a really tough Christmas shopping season, but a lot of this is built into the stocks, and there is huge stimulus coming down the pipeline,” Alan Gayle, senior investment strategist at Ridgeworth Capital Management in Richmond, Virginia, said on Bloomberg Television. “We are cautiously bullish.” Ridgeworth manages $70 billion.
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The S&P 500 climbed for a fifth day, adding 1 percent to 896.24 to complete its longest streak of gains since July 2007. The Dow Jones Industrial Average rallied 102.43 points, or 1.2 percent, to 8,829.04, while the Nasdaq Composite Index increased 0.2 percent to 1,535.57. Almost two stocks rose for each that fell on the New York Stock Exchange.
Best Week Since ‘74
The S&P 500 surged more than 12 percent this week, its best weekly performance since 1974, as the Federal Reserve committed as much as $800 billion to help resuscitate lending markets and investors speculated President-elect Barack Obama’s economic team will bolster growth. Obama said Nov. 26 that he will implement plans to shore up the economy on “day one” of his presidency.
About 787 million shares changed hands on the NYSE in the slowest trading session of the year. U.S. exchanges were shut yesterday for the Thanksgiving holiday and closed at 1 p.m. today.
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