Wall Street jumps

US stocks rose for a third day on Thursday on relief that a ratings cut by S&P in General Electric was just one notch and that no further cuts loomed, while retail sales data showed some stabilisation in consumer spending. Wall Street closed out its best three-day run since the end of November after GE.
The ninth-largest company in the S&P 500 and viewed as an economic bellwether, jumped nearly 13 percent to $9.57. Standard & Poors stripped it of its AAA rating, citing the expectation for poor earnings at its finance unit, and assigned a "stable" outlook. Investors had feared the credit rating downgrade would be deeper or the outlook negative.
"The outlook was stable. Thats very good news," said Hugh Johnson, chief investment officer of Johnson Illington Advisors in Albany, New York. "It wasnt quite as bad as it could have been." Wal-Mart Stores Inc, up 3.1 percent at $48.94, ranked among the Dows top advancers following a government report that showed sales at US retailers fell by an unexpectedly small margin in February.
The Dow Jones industrial average climbed 239.66 points, or 3.46 percent, to 7,170.06. The Standard & Poors 500 Index jumped 29.38 points, or 4.07 percent, to 750.74. The Nasdaq Composite Index added 54.46 points, or 3.97 percent, to 1,426.10. The Dow closed above 7,000 for the first time since February 27, but remains down 49 percent from its record close in October 2007.
For the month of March, the blue chip average is up 1.5 percent. But the Dow is off 18.3 percent for the year so far. For the third straight day, comments from a top banker drove battered bank shares sharply higher. Bank of America Chief Executive Kenneth Lewis said the largest US bank was profitable in January and February, and should be able to ride out the recession without any additional help from taxpayers.
Lewis comments echoed statements by Citigroup and J.P. Morgan Chase executives in the two previous trading sessions. Bank of Americas stock surged nearly 19 percent to $5.85 and J.P. Morgan gained 13.7 percent to $23.20. Citigroup added 8.4 percent to $1.67. Wells Fargo & Co soared 17.4 percent to $13.95.
The KBW banks index shot up 11.2 percent. Investor sentiment also got a lift from a flurry of take-over activity in the biotechnology sector, driving up shares of health-care companies. The Amex Biotechnology index Baq, biopharmaceutical company Gilead Scibuy CV Therapeutics Inc for ab of a hostile bid for CV from Japans Astellas Pharma Inc. Gilead shares gained 0.res soared 31.5 percent to $21.04.
Shares of peer Celgene Corp rose 11.7 percent to $47.16, placing it among the stocks contributing the most to the Nasdaqs advance. Celgene was the top percentage gainer in the S&P 500 health-care index, which rose 5.2 percent. Genentech rose 1.9 percent to $93.92 on the New York Stock Exchange after Swiss drugmaker Roche Holding AG struck a deal to acquire all of the companys outstanding shares for $46.8 billion.
Dow component Pfizer advanced 9.6 percent to $14.02 following news that its drug was effective in slowing a rare type of pancreatic cancer. Shares of General Motors climbed 17.2 percent to $2.18 after the automaker said that it will not immediately need $2 billion in emergency funding for March. Shares of Ford Motor added 7.1 percent to $2.10.
Trading was active on the New York Stock Exchange, with about 1.81 billion shares changing hands, above last years estimated daily average of 1.49 billion, while on Nasdaq, about 2.44 billion shares traded, above last years daily average of 2.28 billion. Advancing stocks outnumbered declining ones on the NYSE by about 11 to 1, while on the Nasdaq, more than four stocks rose for every one that fell.