Stock markets staged a massive rally yesterday, soaring as much as 7 percent after the Treasury Department unveiled a plan to help banks purge their balance sheets of toxic assets and home sales made a surprising rebound.
The blue-chip Dow Jones industrial average closed up 6.8 percent, or 497.48 points, to 7775.86. It was the fifth-largest point gain in its history. The broader Standard & Poor’s 500-stock index rose 7.1 percent, or 54.38, to 822.92. The tech-heavy Nasdaq jumped 6.8 percent, or 98.50, to 1555.77.
The markets have fluctuated wildly this month, scraping 12-year lows before roaring back to life. Over the past two weeks, the Dow has risen 18.8 percent, the biggest increase since 1938. The S&P’s 21.6 percent jump was the largest since 1933.
“I think it’s very sustainable,” said Bernie McGinn, founder and chief executive of McGinn Investment Management. “I think the direction for the next couple of months is upward.”
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