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Stocks move higher a day after big dive
NEW YORK — The stock market reclaimed some losses from its biggest dive this year and returned Wednesday to its pattern of steady gains and stable trading. Reassuring reports on productivity and hiring overshadowed worries about the Greek debt crisis.
Stock indexes made solid gains by mid-morning after the government said oil refineries are operating at a faster clip than economists had expected. Oil refiners Valero Energy Corp. and Tesoro Inc. were among the biggest gainers in the Standard & Poor’s 500.
The Dow Jones industrial average closed up 78.18 points, or 0.6 percent, at 12,837.33. The S&P 500 index gained 9.27, or 0.7 percent, to close at 1,352.63. The Nasdaq composite index added 25.37, or 0.9 percent, to close at 2,935.69.
The Dow dived 203 points on Tuesday, the biggest hitch in a strong rally for stocks this year. Many market-watchers believe that stocks had risen too quickly and were due for a setback. Before Tuesday, the Dow was up more than 6 percent for 2012.
The average has gained more than 20 percent since last Oct. 3, and the rally has proved resilient. Tuesday was the eighth time during that stretch that the Dow fell more than 200 points. Each previous time, it made up most or all of its losses within days.
Tuesday’s sell-off was triggered by fears that not enough private investors would sign on to exchange their Greek government bonds for replacements with a lower face value and interest rate.
Greece needs the investors to agree so it can secure an international bailout of €130 billion, or $171 billion, and avoid a default later this month that would rattle the world financial system.
By Wednesday, owners of about half of Greece’s privately held debt had agreed. Greece needs a 90 percent voluntary participation rate, but 70 percent could be enough for Greece to strong-arm the holdouts.
European markets and the euro rose slightly. Benchmark indexes finished 0.9 percent higher in France, 0.6 percent higher in Germany and 0.4 percent higher in Britain. The euro rose to $1.315 from $1.311 on Tuesday.
Before the U.S. market opened, the government said workers were more efficient late last year, though productivity grew more slowly than in the summer. As productivity growth slows, businesses may need to hire more people to keep up with demand.
A closely watched private estimate of hiring also exceeded economists’ expectations. Payroll processor ADP said employers added 216,000 jobs last month. The result lifted hopes about the big February jobs report, which comes out Friday.
Webman said the report will signal whether hiring is brisk enough to offset the economic drag of high gas prices.
“There’s a foot race between gas bills and paychecks,” he said. “If we continue to print new paychecks at the rate we’ve been adding them, that mitigates a lot of the damage of higher gasoline prices.”
The economic optimism pushed prices for U.S. government debt lower and yields higher. The yield on the benchmark 10-year Treasury note rose to 1.98 percent from 1.95 percent late Tuesday.
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