Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Stocks end higher after Obama speech

dow.png By Annalyn Censky, staff reporter


NEW YORK (CNNMoney.com) -- Stocks ended Wednesday higher as investors shifted their focus from worries about European banks to President Obama's $350 billion jobs recovery plan.

The Dow Jones industrial average (INDU) rose 46 points, or 0.45%, to 10,387 the S&P 500 (SPX) gained 7 points, or 0.6%, to 1,099 and the Nasdaq (COMP) Composite climbed 20 points, or 0.9%, to 2,229.

Stocks are coming off losses Tuesday, when all three major indexes fell more than 1% as investors worried that European banks are in worse shape than previously believed.

But those fears subsided a bit Wednesday morning after the Portuguese debt auction was met with healthy demand. Experts caution that concern about Europe's banks may have eased but the problems are far from disappearing.

As austerity measures take effect in several European countries and various data continue to point to slower economic growth globally, sovereign credit spreads have started widening again, nearing the levels they were at in the spring, said David Chalupnik, the head of equities at First American Funds.

Wider credit spreads are a sign that funding government debt could become more challenging for debt-laden European countries, he explained.

Economy: The Federal Reserve's Beige Book, a snapshot of economic conditions across the central bank's 12 districts, suggested the economy continued to grow between mid-July and the end of August, but with "widespread signs of a deceleration" compared with earlier periods.

A separate report from the Fed showed that consumer debt fell by $3.6 billion in July -- far less than the $5.25 billion decrease predicted by economists surveyed by Briefing.com.

Obama: President Obama officially unveiled three new proposals aimed at bolstering the shaky economic recovery in a speech in Cleveland.

They include an estimated $200 billion in tax breaks for businesses that invest in new plants and equipment; a $100 billion extension of the business tax credit for research and development; and $50 billion over the next decade to improve roads, rails and other infrastructure.

Congress is not expected to pass the proposals soon.

Companies: Shares of BP (BP) surged more than 3% at the opening bell after Fitch upgraded the company's rating three notches.

The ratings firm said the upgrade "primarily reflects an end to the threat of further leaks from the Macondo well in the Gulf of Mexico."

World markets: European shares gained. The CAC 40 in France rose 0.9%, the DAX in Germany added 0.8%, while Britain's FTSE 100 edged up 0.4%.

Asian markets ended sharply lower after the yen hit another 15-year high against the dollar. Japan's benchmark Nikkei index tumbled 2.2% and the Hang Seng in Hong Kong dropped 1.5%. The Shanghai Composite ended 0.1% lower.

Currencies and commodities: The dollar rose against the Japanese yen after sinking to a fresh 15-year low earlier, and the greenback fell against the euro and the British pound.

Oil futures for October delivery rose 41 cents to settle at $74.67 a barrel.

Gold for December delivery fell $1.80 to settle at $1,257.50 an ounce.

Bonds: The yield on the 10-year Treasury note rose to 2.65% from 2.61% late Tuesday. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.90%4.01%
15 yr fixed3.01%3.13%
5/1 ARM3.19%3.26%
30 yr refi3.98%4.12%
15 yr refi3.08%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,689.86 -56.12 -0.32%
Nasdaq 5,128.28 -0.50 -0.01%
S&P 500 2,103.84 -4.79 -0.23%
Treasuries 2.20 -0.06 -2.78%
Data as of 7:10pm ET
Company Price Change % Change
Bank of America Corp... 17.88 -0.25 -1.38%
Micron Technology In... 18.51 -1.39 -6.98%
Facebook Inc 94.01 -1.20 -1.26%
Apple Inc 121.30 -1.07 -0.87%
Frontier Communicati... 4.72 0.09 1.94%
Data as of Jul 31

Sections

Some families are outraged at the sums they've been offered by Lufthansa as compensation for the Germanwings plane crash in March which killed 150 people. More

Fast-food chains that operate in more than 30 locations nationwide are the sole target of a new rule in New York to hike their minimum wage to $15. But consumers and small business owners, as well as some employees, may be the ones to pay the price. More

You can't blame it on the economy anymore. More Millennials now have jobs, but are still living at home. More