By Kate Gibson
U.S. stocks on Friday surged on a report President-elect Barack Obama would nominate New York Federal Reserve President Timothy Geithner as Treasury secretary. The leap higher in the final hour of trade came on the heels of a two-session freefall and halved the market's weekly decline.
After a volatile session, equities rocketed higher in the wake of an NBC report that Obama would appoint Geithner to head the Treasury Department.
Of the trio, Geithner is "the one people in the market wanted to see," said Owen Fitzpatrick, head of the U.S. equity group at Deutsche Bank. The choice is particularly important in light of Treasury Secretary Hank Paulson's comments earlier in the week "of being done with Tarp," said Fitzpatrick of the Paulson's decision to let the next administration decide how to spend the remaining roughly $350 billion of $700 billion bailout package.
"The comfort level is there with Geithner," said Fitzpatrick.
The Dow Jones Industrial Average (DJI) surged more than 500 points before finishing at 8,046.42, up 494.13 points, or 6.5%. The blue-chip index lost 5.3% for the week.
"The market's message is Geithner is a good choice. He's young, he's intelligent and he's experienced. What this country needs are people who are young, full of energy, and can put in 26-hour days. There's nothing like leverage," said Hugh Johnson, chairman of Johnson Illington Advisors.
Of the Dow's 30 components, all but two ended in the green, led by aluminum producer Alcoa Inc. (AA), up 23.2%.
Wal-Mart Stores Inc. (WMT) gained 4.5% after the discount retailer unexpectedly named international chief Mike Duke to succeed Lee Scott as president and chief executive, effective Feb. 1. .
Shares of Citigroup (C) fell 20% as analysts pondered what the future holds for the financial-services company, which a year ago was valued at about $180 billion, and now stands at $20 billion. .
The S&P 500 (SPX) gained 47.59 points, or 6.3%, to 800, leaving it down 8.4% from last Friday's close.
Energy, utilities and materials led gains across all 10 of the S&P's industry groups.
The Nasdaq Composite (RIXF) gained 68.23 points, or 5.2%, to 1,384.35, with the index tallying a weekly loss of 8.7%.
Volume on the New York Stock Exchange neared 2.4 billion, with advancers beating decliners about 5 to 3. On the Nasdaq, more than 1.4 billion shares traded hands, and advancers also topped decliners roughly 8 to 5.
Gold shines
Oil futures added 51 cents to end at $49.93 a barrel, but posted a loss of 13% on the week.
Gold futures gained, briefly topping $800 an ounce for the first time in more than a month, as wary investors continued to turn to safe-haven buying. Gold for December delivery rallied $43.10, or 5.8%, to finish at $791.80 an ounce, leaving it up 6.6% on the week.
Treasury prices declined, pushing yields up from multi-year lows hit the prior day. .
"The Treasury market will gladly give up some gains to calm a bunch of near-suicidal equity traders," said Kevin Giddis, bond analyst at Morgan Keegan & Co. Inc.
Dell Inc. (DELL) fell 5.2% after the computer maker late Thursday said its quarterly profit dropped a less-than-forecast 5%.
The Gap Inc. (GPS) rallied 27.2% after the retailer said its profit rose 3% and backed its annual earnings outlook.
Autodesk Inc. (ADSK) slumped 14.6% as the design software maker warned on its fourth-quarter outlook. .
U.S. stock gains early on followed a higher close in Asia, where markets sprang back from losses as traders speculated that China may cut interest rates further.
In Europe, stocks lost early gains as data showed the continent's economy contracting at a brisk pace. .
(END) Dow Jones Newswires
November 21, 2008 17:45 ET (22:45 GMT)

Publié le 21 novembre 2008 Copyright © 2008 Dowjones