6 Feb 2009

Hopes for banking rule change lift Wall St

11:54 am on 6 February 2009

Stocks in the United States rallied on Thursday on hopes that a government plan to shore up the financial system will include a change in accounting rules to stem bank write-downs.

The Obama administration is due to announce a bank rescue plan next week.

Bank stocks reversed losses in late morning trade: Bank of America finished up 3%, while JPMorgan rose 2.1%.

The Dow Jones industrial average rose 106.41 points, or 1.34%, to 8,063.07.

Standard & Poor's 500 Index gained 13.62 points, or 1.64% to 845.85. The Nasdaq Composite Index climbed 31.19 points, or 2.06%, to 1,546.24.

The rise was in contrast to Wednesday, when trading fizzled.

Technology shares were also up: Apple added 3.1% to $US96.46 and Cisco rose 3.2% to $US16.35.

Wal-Mart rose 4.6% to $US48.56 on the New York Stock Exchange after posting solid sales in January.

Volume was active on the New York Stock Exchange, where about 1.63 billion shares changed hands. About 2.56 billion shares were traded on the Nasdaq.