- The Washington Times - Thursday, December 10, 2009

NEW YORK | Investors set aside some of their concerns about mounting debt levels around the world and looked for bargains after a two-day slide in stocks.

Stocks turned higher late Wednesday after a day of back-and-forth trading. Investors have been cautious about rising government debt levels in Spain, Greece and other countries.

The Dow Jones Industrial Average rose 51 points to regain about half of what it lost a day earlier.

Investors spent much of the day looking for safety following a decision by credit rating agency Standard & Poor’s to reduce the outlook on Spain’s debt rating.

S&P;’s move came a day after another agency lowered its credit rating on Greece’s government. Investors have been watchful for other signs of problems with global debt ever since a state-run company in Dubai shocked investors two weeks ago by asking its creditors for a debt reprieve.

The Dow rose 51.08 to 10,337.05 after falling 104 on Tuesday. The S&P; 500 Index rose 4.01 to 1,095.95, while the Nasdaq Composite Index rose 10.74 to 2,183.73.

Investors grew concerned that heavy debt loads in countries such as Greece and Spain as well as the United States and Britain could signal that the threat of defaults and higher borrowing costs could upend a nascent global economic rebound.

While investors want to see the economy grow, they also know that the Federal Reserve could raise interest rates and remove other stimulus measures once the economy appears to be on solid footing. Higher rates could make stocks look less appealing as returns for other investments improve, potentially upsetting a nine-month advance in stocks that has lifted the S&P; 500 by 61.4 percent.

Not all the day’s news was downbeat. The Commerce Department reported that businesses added to inventories at the wholesale level in October after a record 13 straight months of reductions. Investors hope it is a sign that businesses will soon start restocking store shelves. Wholesale inventories rose 0.3 percent in October; economists had expected a 0.5 percent drop.

The government reported Friday that employers cut the fewest jobs in November since the recession began two years ago. The figures were far better than expected and prompted a re-evaluation of where the Fed stands, despite comments from Fed Chairman Ben S. Bernanke that interest rates will remain low.

In other trading, Treasurys fell, sending yields higher. The yield on the benchmark 10-year Treasury note rose to 3.44 percent from 3.39 percent late Tuesday.

The Russell 2000 Index of smaller companies rose 0.33, or 0.1 percent, to 598.03.

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