Dow Gains 6.7 Percent on Late-Day Rally

Wall Street soared yesterday, finishing a session in which the Dow Jones industrial average swung wildly within a 900-point range by staging a massive rally that snapped a three-day streak of losses.

Stocks spent most of the morning flat, then took a volatile turn, falling deep into the red early in the afternoon and briefly slipping below 8000 on the Dow Jones industrial average. At day's end, those losses had been more than wiped away in a burst of bargain hunting.

Some of the rebound was triggered by automated buy orders when the Dow and Standard & Poor's 500-stock index neared lows for the year, analysts said. The buying accelerated and turned into a late-day rally, sparking optimism that the market had seen its worst days and would not break through the lows of last month -- the Dow closed at 8175.77 on Oct. 27.

The Dow closed up 6.67 percent, or 552.59 points, at 8835.25 -- its third-largest point gain in history. The S&P gained 6.92 percent, or 58.99 points, to close at 911.29.

The tech-heavy Nasdaq composite index struggled but ended up 6.5 percent, or 97.49 points, at 1596.70. It had been weighed down by Intel, which lowered its fourth-quarter revenue forecast by $1 billion late Wednesday, a grim sign for the rest of the sector. Intel surged 7 percent to close at $14.43 a share after falling more than 4 percent earlier.

"This is more of a technical buy as opposed to a fundamental shift" in investors' downbeat sentiment about the economy, said Matthew D. McCormick, banking analyst for Bahl & Gaynor Investment Counsel. "I am suspect of the sustainability of this rebound. I would rather see slow and steady 50-point days than a 500-point day."

The energy sector led the rally as crude oil prices rose 4 percent to $58.24 a barrel, despite the International Energy Agency's prediction that global oil demand would continue to fall next year. Exxon Mobil surged 9 percent to $75.41. Chevron led the Dow, gaining 12.5 percent to close at $75.71.

Investors shrugged off weak economic data and more indications that corporate profits would be squeezed by economic woes.

Wal-Mart, the nation's largest retailer, yesterday became the latest consumer-related firm to trim its profit outlook, as it expects currency fluctuations to hurt it overseas. But Wal-Mart shares closed up 4 percent at $54.93 after it reported a 10 percent increase in third-quarter profits.

New economic data were weak. The number of people requesting jobless benefits increased by 32,000 last week to a seasonally adjusted 516,000, far more than expected by analysts and the highest level in seven years.