Tuesday, August 9, 2011

Wall Street roars back in wild trade after Fed meeting

US stocks rallied on Tuesday in a volatile session as investors struggled to decipher the Fed's signals on the economy after a dizzying two-week slide.

The Dow Jones industrial average gained 429.92 points, or 3.98 percent, to end at 11,239.77. The Standard & Poor's 500 Index rose 53.07 points, or 4.74 percent, to 1,172.53. The Nasdaq Composite Index added 124.83 points, or 5.29 percent, to 2,482.52.

European shares ended broadly higher, halting a 20 percent dive over 2-1/2 weeks as traders started rummaging around for bargains, with hopes the US Federal Reserve will hint at a plan to revive its economy.

The pan-European FTSEurofirst 300 index of top shares closed up 1.2 percent at 947.90 points, with volume more than double its 90-day daily average after sinking by as much as 5 percent and hitting a two-year low earlier in the session.

The Nikkei average closed down 1.7 percent in heavy volume, cutting its losses on bargain hunting after tumbling more than 4 percent in the wake of a plunge on Wall Street and a downgrade of US sovereign debt. The benchmark Nikkei ended down 153.08 points at 8,944.48, after falling as low as 8,656.79 in heavy trade. That was just above an intraday low marked on March 17 of 8,639.56.