US stocks rose on Thursday as financial shares recovered from recent losses and a bid to buy the Chicago Board of Trade gave investors optimism. But even with the gains, investors remain largely cautious about the fallout from subprime mortgage losses.
Former Federal Reserve Chairman Alan Greenspan added to those worries when he warned that problems in the subprime market could spread into other sectors. Financial stocks, which were among the hardest hit in Tuesday's sell-off, rose for a second day. Shares of Wells Fargo & Co, the No 5 US bank, gained 1.6 percent to $34.20. Shares of Countrywide Financial Corp, which like Wells Fargo made mortgages to subprime borrowers, rose 2.9 percent to $35.39.
The Dow Jones industrial average was up 30.61 points, or 0.25 percent, at 12,164.01. The Standard & Poor's 500 Index was up 5.89 points, or 0.42 percent, at 1,393.06. The Nasdaq Composite Index was up 5.84 points, or 0.25 percent, at 2,377.58.
Helping the positive tone, electronic energy marketplace IntercontinentalExchange made an unsolicited bid for CBoT Holdings Inc, the parent of the Chicago Board of Trade. In October, the Chicago Mercantile Exchange had agreed to buy the CBoT.
Greenspan, speaking to the Futures Industry Association in Boca Raton, Florida, said it was "hard to find any such evidence" about spillover from housing yet. But he added, "You can't take 10 percent out of mortgage origination's without some impact."