Newspaper article THE JOURNAL RECORD

Lower Interest Rates Fuel Stock Rally

Newspaper article THE JOURNAL RECORD

Lower Interest Rates Fuel Stock Rally

Article excerpt


NEW YORK (AP) - The stock market broke out of a four-session slump Wednesday with a rally inspired by falling long-term interest rates.

Technology stocks helped lead the advance.

The Dow Jones average of 30 industrials, down more than 50 points from last Wednesday through Tuesday's close, rebounded 32.68 points to 2,955.20.

Advancing issues outnumbered declines by about 3 to 2 in nationwide trading of New York Stock Exchange-listed stocks, with 933 up, 633 down and 486 unchanged.

Volume on the floor of the Big Board came to 176 million shares, against 176.44 million in the previous session. Nationwide, consolidated volume in NYSE-listed issues, including trades in those stocks on regional exchanges and in the over-the-counter market, totaled 213.45 million shares.

Chairman Alan Greenspan of the Federal Reserve confirmed Wednesday that the central bank took fresh action late last week to relax its credit policy.

The move surprised many Fed-watchers in the financial world, who had been expecting Greenspan to hold off on any further moves until March economic data provided some indication of the postwar state of the economy.

With a push from the Fed, short-term interest rates have been declining. But long-term rates had risen in recent days, apparently in anticipation of impending signs that the economy may be recovering from the recession.

Long-term bonds changed course Wednesday, however. Prices of Treasury bonds climbed almost $10 for each $1,000 in face value, lowering their yields to the 8.18 percent-8.22 percent range. …

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