Wall Street extended its advance Wednesday as investors grew more optimistic that the worst of the credit crisis is over and as the government released tame October inflation data.
Bear Stearns Cos. Chief Financial Officer Sam Molinaro said Wednesday the investment bank's leveraged finance business is improving. He said the company expects to take a $1.2 billion writedown during the fourth quarter, which eased concerns that the losses might be much higher.
Wednesday's news followed reassuring comments from Goldman Sachs Group Inc. about its own credit exposure that sent stocks climbing and propelled the Dow Jones industrials up nearly 320 points. Britain's HSBC Holdings PLC did say Wednesday it would have to write off a further $3.4 billion from its U.S. business during the third quarter because of exposure to subprime loans, but reports of the writedowns Tuesday likely blunted the market's reaction.
The Dow rose 47.39, or 0.36 percent, to 13,354.48.
Broader stock indicators also gained. The Standard & Poor's 500 index rose 8.78, or 0.59 percent, to 1,489.83, while the Nasdaq composite index rose 18.80, or 0.70 percent, to 2,692.45.
/ Source: The Associated Press