Employment Hopes Prompt End of Trading Day Rally
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

Wall Street soared for the second straight day today, rallying in the last hour of trading after a rebound in financial stocks and optimism about private sector jobs helped investors brush off a sharp jump in oil prices. The Dow Jones industrials rose more than 180 points, bringing its two-day gain to more than 450.
Bank and brokerage stocks, many trading at multi-year lows, turned higher and led the late advance. There was some relief in the market after the Federal Reserve said it would extend and expand its emergency borrowing program for investment banks. The central bank’s move reassured the market that the banks won’t suffer from liquidity problems.
Investors have been worried that some of Wall Street’s biggest names will be marking down more assets, and needing more capital, after Merrill Lynch & Co. unexpectedly announced a $5.7 billion write-down late yesterday.
“There’s a growing sense that what we saw out of Merrill Lynch is the beginning of the end for the financial cleanup,” a market strategist at Jefferies & Co., Craig Peckham, said. He added that the ADP number was also a good sign for the economy.
Earlier, Automatic Data Processing said private sector employment rose by 9,000 this month. After seeing jobs disappear by the thousands in recent months, the stock market is eager for any insights into the Labor Department’s take on the job market on Friday.
That news helped offset a big spike in the price of oil after a weekly Energy Department report on domestic supplies showed a surprise increase. And Prime Minister Olmert’s announcement that he plans to resign in September stirred concerns about the viability of Middle East peace efforts and rising tensions with Iran.
Light, sweet crude rose $4.58 to settle at $126.77 on the New York Mercantile Exchange. Oil has fallen sharply, however, since hitting a high above $147 on July 11, and a drop in prices yesterday contributed to a huge gain on Wall Street.
The late rally may also have been due to technical trading; in times of great volatility, many institutional investors start adjusting their holdings before the closing bell.
According to preliminary calculations, the Dow rose 186.13, or 1.63%, to 11,583.69. Yesterday, the blue chips jumped 266 points, more than wiping out a nearly 240-point loss from the previous session.
Broader stock indicators also surged. The Standard & Poor’s 500 index advanced 21.06, or 1.67%, to 1,284.26, and the Nasdaq composite index rose 10.10, or 0.44%, to 2,329.72.