JPMorgan Chase & Co., Citigroup Inc. and Bank of America Corp. jumped more than 9 percent as President George W. Bush urged the passage of bailout legislation and congressional leaders vowed to resume work on the bill after its defeat spurred the S&P 500's biggest decline in two decades. Hess Corp. and Schlumberger Ltd. rose more than 5.3 percent as speculation about the plan's revival helped oil rebound from a $10-a-barrel drop.
The S&P 500 rose 32.78 points, or 3 percent, to 1,139.17 at 11:03 a.m. in New York. The Dow Jones Industrial Average gained 233.76, or 2.3 percent, to 10,599.21 after falling a record 777.68 points yesterday. The Nasdaq Composite Index added 2.8 percent to 2,038.42. European stocks rose, while Asian shares declined.
The gains helped the S&P 500 pare losses in its worst September since 1937. More than $1 trillion in market value was erased yesterday in the worst day for stocks since the ``Black Monday'' crash of 1987 after the House of Representatives voted down the plan designed to rid financial institutions of bad loans.
The S&P 500 has declined 11 percent in September and the Dow average has lost 8.1 percent. The Nasdaq is down 14 percent. The S&P 500 has retreated 11 percent since the end of June for its fourth-straight quarterly decline, the longest stretch since 2001. The Dow has slipped 6.6 percent and the Nasdaq is down 11 percent.
The MSCI World Index of 23 developed nations has dropped 13 percent this month as almost $600 billion of credit losses and writedowns at financial institutions worldwide prompted banks to hoard cash, forced Lehman Brothers Holdings Inc. into bankruptcy and spurred government seizures of American International Group Inc. and the U.K.'s Bradford & Bingley Plc.
Europe's Dow Jones Stoxx 600 Index added 0.6 percent today as Dexia SA, the world's biggest lender to local governments, surged 12 percent on a 6.4 billion-euro ($9.2 billion) state- backed rescue.
London equities rallied on Tuesday as investors began to bet that indices might have reached their lowest levels after the failure of the Bush administration’s financial rescue package. The FTSE 100 rose 70 points to 4,889.33, a rally of 1.46 per cent at 3.30 local time, extending gains after a strong open on Wall Street.