Dow Ends 8-Day Losing Streak, S&P Up for 2011

Dow

11,896.44

+29.82

+0.25%

By: JeeYeon Park

CNBC.com Writer

Stocks recovered from a sharp selloff in volatile trading Wednesday with the Dow breaking an eight-day losing streak, despite a handful of weak economic news, ongoing euro zone jitters and a possible U.S. credit downgrade.

The Dow Jones Industrial Average rebounded 29.82 points, or 0.25 percent, to finish at 11,896.44, snapping an eight-day losing streak. The Dow was down 166 points at session lows.


The S&P 500 rose 6.29 points, or 0.50 percent, to close at 1,260.34. The index bobbed back into positive territory for the year after trading below its March low of 1,249.05 for most of the session.


The tech-heavy Nasdaq advanced 23.83 points, or 0.89 percent, to end at 2,693.07. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell near 23.

Volume was heavier than usual with the consolidated tape of the NYSE at 5.5 billion shares, while 1.35 billion shares changed hands on the floor.






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“We’re churning after the last couple of selloffs…we’re volatile and whippy today,” said Kenny Polcari, managing director at ICAP Equities. “[The S&P 500] is clearly trying to hold above the 1,249 level—it will be the last significant support level.”

Despite the technical bounce, Polcari said investors need to continue watching macroeconomic developments over the week.


While both Moody's and Fitch confirmed their AAA-rating on the U.S. after President Obama signed a bill that averted a debt default, threats of future downgrades kept investors nervous. Several experts told CNBC that the deal simply "kicked the can down the road," and that at best the issue would be raised before the end of the year.

Gold closed at another record high at $1,663.40 an ounce, driven by deepening fears over the spread of the European debt crisis and amid data that showed a number of central banks bought gold in June.


Meanwhile, oil prices slumped after a government report showed a surplus in crude stocks and amid demand worries. U.S. light, sweet crude slipped $1.86 to settle at $91.93 a barrel, while London Brent crude fell $3.23 to settle at $113.23.