- The Washington Times - Friday, August 29, 2008

NEW YORK | Wall Street barreled higher Thursday after a better-than-expected reading on the gross domestic product gave investors some reassurance that the economy is holding up. The Dow Jones Industrial Average jumped more than 200 points.

A decline in oil prices also appeared to add force to the rally in stocks. But trading volume was again light heading toward the Labor Day weekend, a condition that can skew price moves.

The Dow rose 212.67, or 1.85 percent, to 11,715.18, bringing its three-day advance to nearly 330 points. Still, for the week, the Dow is up only slightly after a big decline Monday on credit worries.

Broader stock indicators also rose Thursday. The Standard & Poor’s 500 index advanced 19.02, or 1.48 percent, to 1,300.68, and the Nasdaq composite index rose 29.18, or 1.22 percent, to 2,411.64.

Bonds fell as investors moved into stocks. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.79 percent from 3.77 percent late Wednesday. The dollar rose against most major currencies. Gold also advanced.

Light, sweet crude fell $2.56 to settle at $115.59 on the New York Mercantile Exchange.

The decline in oil made energy stocks one of the session’s few areas of weakness. Devon Energy Corp. fell $3.62, or 3.4 percent, to $103.16, while Hess Corp. fell $1.61, or 1.5 percent, to $105.53.

Financial shares advanced after MBIA Inc. agreed to reinsure nearly $200 billion of municipal bonds backed by FGIC Corp. The deal between the two bond insurers led to some hopes that the troubled credit market is beginning to right itself. MBIA jumped $4.17, or 35 percent, to $16.15. Other bond insurers also rose, with Ambac Financial Group Inc. climbing $2.18, or 42 percent, to $7.42.

Government-chartered mortgage companies Fannie Mae and Freddie Mac rose for a fourth straight session after Fannie Mae announced a management shake-up and analysts raised further doubts that a government bailout of the companies is in the offing; such a move could wipe out shareholder equity.

Fannie Mae rose $1.47, or 23 percent, to $7.95, while Freddie Mac rose 53 cents, or 11 percent, to $5.28.

Among retailers, Tiffany & Co. jumped $4.24, or 11 percent, to $43.85 after reporting that its second-quarter profit doubled as sales jumped in Asia and Europe.

Zale Corp. forecast a fiscal 2009 profit that topped what Wall Street had been expecting. The specialty jeweler rose $4.77, or 21 percent, to $27.92.

Advancing issues outnumbered decliners by about 3 to 1 on the New York Stock Exchange, where consolidated volume came to a very light 3.73 billion shares, up from 3.42 billion shares Wednesday.

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