Stocks struggle higher
Wall Street up as the Senate hearing about the proposed $700 billion bailout plan gets underway.
NEW YORK (CNNMoney.com) -- Stocks inched higher at the open Tuesday, following the previous day's steep selloff, as a Senate hearing on the proposed $700 billion financial services bailout plan got underway.
The Dow Jones industrial average (INDU), the Standard & Poor's 500 (SPX) index and the Nasdaq composite (COMP) all gained in the early going.
On Monday, all three major indexes slumped, with the Dow industrials sinking 373 points on worries about what details may emerge from the government's plan to restore financial stability. It was the fourth day in a row that the Dow posted a move of 350 points in either direction, reflecting the extreme volatility present in markets right now.
In testimony prepared for a Senate Banking Committee hearing, both Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke said that immediate action is needed to save the economy.
Paulson said the bailout is necessary "in order to avoid a continuing series of financial institution failures and frozen credit markets that threaten American families' well-being, the viability of businesses both small and large, and the very health of our economy."
"Action by the Congress is urgently required to stabilize the situation and avert what otherwise could be very serious consequences for our financial markets and for our economy," Bernanke said.
The Congressional debate continues over the details of the plan to save Wall Street. The Democrats are seeking government ownership of certain assets, in exchange for putting up the money.
Art Hogan, chief market strategist for Jefferies, said that investors are still nervous about deteriorating earnings in the hard-hit finance sector, despite the call for a bailout.
Hogan said slow earnings growth in the finance sector is "going to give us ongoing pressure even if we get expedited approval of the bailout. I think that's crept into investors' psyche."
Oil: Oil prices recorded their biggest one-day jump in history on Monday, when the October contract surged $25 a barrel during late-day trading before closing up $16.37 to $120.92 a barrel. The late surge was partly due to the expiration of the October contract, which prompted traders to rush to fill obligations.
Early Tuesday, the November contract - now the front month - was trading down 87 cents to $108.50 a barrel.
Company news: Lennar (LEN, Fortune 500), a home-building company that provides financial services, announced third-quarter results before the opening bell. The company's loss narrowed to 56 cents a share while revenue plummeted 53% to $1.1 billion. Both results came in slightly better than expected, but the results still indicate weakness in the housing sector.
Other markets: European markets were down, but the Nikkei closed higher. The dollar fell versus the euro and the Japanese yen. 
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