Stocks surge at openBig gains for major indexes after Fed acts with other central banks in plan to relieve the credit crisis.NEW YORK (CNNMoney.com) -- U.S. stocks jumped at the open Wednesday as the Federal Reserve announced a coordinated global effort to combat the credit crunch. The Dow Jones industrial average (Charts) gained 1.5 percent, while the broader S&P 500 (Charts) index also added 1.5 percent and the tech-fueled Nasdaq (Charts) composite soared 2 percent. Before the markets opened, the Fed said it was coordinating a response to the credit crisis with the central banks of Europe, Canada, Britain and Switzerland. It said it is creating a temporary credit facility that banks could tap in order to continue making loans to individuals and businesses. Stocks tumbled Tuesday after the central bank cut its key short-term interest rate by a quarter of a point, disappointing investors who had hoped for a half of a percentage point cut. In economic news, the U.S. trade deficit grew in October compared to the previous month, according to the government's latest reading that showed the gap between imports and exports was slightly larger than Wall Street expectations. Exxon Mobil (Charts, Fortune 500) said late Tuesday that it plans to build a floating liquefied natural gas terminal off the coast of New Jersey, sending its stock price down in Frankfurt trading. General Electric (Charts, Fortune 500) announced late Tuesday that it expects 2008 profits of $2.42 per share, slightly below analysts' forecasts. Bank of America (Charts, Fortune 500) said in a regulatory filing that its fourth-quarter writedowns of collateralized debt obligations will be greater than the $3 billion it estimated a month ago. Treasury prices fell substantially Wednesday, raising the yield on the baseline 10-year note to 4.15 percent. In currency trading, the dollar fell against the euro and rose against the yen. U.S. light crude oil for January delivery rose $1.03 to $91.05 a barrel on the New York Mercantile Exchange. |
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