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Stocks stage late rally to finish higher

Stocks recovered from an early morning dive to end the day with healthy gains.

The Dow rose 44.73 points, or 0.4 percent, to close at 11,105.85. The Dow moved between small gains and losses for much of the day, then turned higher in the last half-hour. The Standard & Poor's 500 index rose 10.60, or 0.9 percent, to 1,172.87. The Nasdaq composite gained 37.06, or 1.5 percent, to 2,532.15.

A report that China would soon buy some of Italy’s debt helped bring the market out of its swoon in the afternoon. Earlier in the trading day, worries about European debt – especially the possibility of a Greek default – helped drive markets down.

The Wall Street Journal said a junior Italian finance minister denied asking China for “any aid in particular” at the meeting and had this  analysts’s take:

"It's just a hypersensitive market," said Quincy Krosby, market strategist at Prudential Financial. "The question becomes at what point do you see conviction buyers coming into the market and taking positions. It'll happen, but it could get sloppy beforehand."

Some observations from the AP:

It was the first back-to-back gain since the last week of August and only the third time the market has closed higher this month. On the five days the market closed lower in September, the Dow Jones industrial average lost between 100 and 303 points. Trading on Tuesday was quiet compared with the many wild swings the market has had since early August.

CNBC's Bob Pisani reports from the NYSE on what drove trading on a "quiet day" and looks forward to tomorrow's business events.