11th hour rally on Wall Street

NEW YORK (CNNMoney.com) -- Stocks rallied late in the session Wednesday as investors scooped up beaten down shares before the closing bell.

The Dow Jones industrial average (up 150.38 to 13,362.37, Charts) jumped 150 points, or 1.2 percent.

The broader Standard & Poor's 500 index (up 10.54 to 1,465.81, Charts) added 0.7 percent and the tech-heavy Nasdaq composite index (up 7.60 to 2,553.87, Charts) gained 0.3 percent.

All three major gauges were mired in the red for most of the trading day until blue chips led the broader market higher with less than 20 minutes left in the session.

"Selling pressure abated late in the day," explained Art Hogan, chief market strategist at Jefferies & Co., largely based on "fear of missing the bottom in an oversold market."

Although that "doesn't mean we can't turn around tomorrow and have some more pressure because the concerns that we have will be with us for a while," he added.

The major gauges had gotten off to a rocky start on the heels of a stock selloff in the previous session as credit concerns, a slumping real estate market and corporate earnings compounded investors nervousness.

But stocks bounced into the black briefly after the Institute for Supply Management reported that nationwide manufacturing activity fell more than expected and the National Association of Realtors' pending home sales index jumped more than expected in June.

Oil prices weighed in following the government's weekly report on crude inventories, which showed a huge drawdown last week. U.S. light crude for September delivery sank $1.68 to $76.53 a barrel after reaching a peak of $78.77, according to Reuters.

After the closing bell, Dow component Walt Disney (up $0.83 to $33.83, Charts, Fortune 500) posted higher profit that came in above expectations.

Starbucks (up $0.52 to $27.20, Charts, Fortune 500) posted higher quarterly earnings and maintained its full-year profit outlook.

The restaurant chain Applebee's (up $0.03 to $24.63, Charts) also reported higher quarterly earnings, as did Weight Watchers (up $0.22 to $48.74, Charts), thanks to higher sales.

But video game publisher Electronic Arts (down $0.54 to $48.10, Charts) posted a quarterly loss and shares slipped 1 percent in extended trade.

In earlier corporate news, Rupert Murdoch finally won his battle for the publisher of The Wall Street Journal. Dow Jones (up $0.72 to $58.10, Charts) agreed to be taken over by News Corp. (up $0.12 to $21.24, Charts) for $5.6 billion.

Time Warner (down $0.62 to $18.64, Charts, Fortune 500), which owns CNNMoney.com, reported second-quarter earnings that topped analysts' estimates and said it has authorized an additional $5 billion stock repurchase. Investors weren't impressed, though, and shares tumbled nearly 5 percent.

Kraft Foods (down $0.32 to $32.43, Charts) posted higher quarterly profit, but shares of the Oreo maker fell.

Alltel (up $0.35 to $66.30, Charts, Fortune 500) rose after the wireless service posted a higher quarterly profit as revenue rose.

Cigna (down $2.75 to $48.89, Charts, Fortune 500) reported lower net income, but operating earnings beat Wall Street expectations. Shares of the health insurer sank 6 percent.

Shares of Qwest Communications (down $0.13 to $8.40, Charts, Fortune 500) also fell 2 percent after the telecommunications carrier said second-quarter profit rose, but came in short of expectations.

DaimlerChrysler (down $0.89 to $89.86, Charts) and Ford Motor (down $0.08 to $8.43, Charts, Fortune 500) both reported sharp drops in July auto sales, while General Motors (up $0.33 to $32.73, Charts, Fortune 500) said sales slumped 22 percent, more than expected. Overall U.S. sales were weaker than expected.

On Thursday, investors will turn their attention to more earnings reports from Nokia (down $0.23 to $28.41, Charts), Consolidated Edison (up $1.26 to $44.94, Charts, Fortune 500) and Eastman Kodak (up $0.30 to $25.55, Charts, Fortune 500) among others, in addition to June's report on factory orders.

Market breadth was negative and volume was heavy. Losers beat winners on the New York Stock Exchange by nine to seven on volume of 2.4 billion shares. Decliners topped advancers by three to two on volume of 3 billion shares on the Nasdaq.

Treasury prices fell, raising the yield on the benchmark 10-year note to 4.79 percent from 4.74 percent late Tuesday. Bond prices and yields move in opposite directions.

The dollar gained against the euro and was little changed versus the yen.

COMEX gold for December fell $3.40 to $675.90 an ounce.